Trade Committee backs €35bn MFA loan for Ukraine

Process in Brief

The Trade Committee voted 31 in favour, 4 against and no abstentions to endorse the Commission proposal for an exceptional Macro-Financial Assistance (MFA) loan of up to €35 billion and the establishment of the Ukraine Loan Cooperation Mechanism. The mechanism will enable repayment of the MFA and other G7 loans from extraordinary revenues generated by immobilised Russian Central Bank assets, as outlined in the proposal.

What Is at Stake

The measure forms part of a G7 initiative to provide up to $50 billion to address Ukraine’s urgent financing needs and to help maintain basic public functions and economic resilience. The MFA loan is undesignated so Ukraine can allocate funds as it sees fit, will follow the management and control systems and anti-fraud measures in the Ukraine Plan, and is conditional on democratic safeguards, respect for human rights and further policy conditions in a memorandum of understanding.

Timeline

Parliament is expected to vote on the proposal during its 21-24 October session, after which the Council plans to adopt the regulation by written procedure and the regulation is expected to enter into force the day after its publication in the Official Journal of the EU.

Sources

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