€50 Billion for Ukraine: EU Council and Parliament Agree on New Support Mechanism for Ukraine

The EU Council and European Parliament reached a preliminary agreement on the creation of a new special mechanism for the recovery, reconstruction, and modernization of Ukraine, as well as to support its efforts in implementing reforms on the path to EU accession. This was reported by the EU Council.

The new Ukrainian fund, amounting to €50 billion, will consolidate EU budget support for Ukraine into a single instrument, ensuring consistent, predictable, and flexible support for the period 2024-2027.

The program for Ukraine will consist of three main components:

• Component I: The Government of Ukraine will prepare the "Ukrainian Plan," outlining its intentions for the recovery, reconstruction, and modernization of the country, as well as reforms planned within the EU accession process.
• Component II: The EU will provide support through an investment program in the form of budget guarantees and a combination of grants and loans from public and private institutions.
• Component III: Support for EU accession and other assistance measures aimed at helping Ukraine adapt to EU legislation and implement structural reforms on the path to future membership.

Ukraine may request an advance payment of up to 7% of the program amount under the "Ukrainian Plan."

"The Ukrainian Fund will allow us to provide consistent and predictable support to Ukraine to help its people rebuild their country in the face of unprecedented challenges posed by Russia's aggression. At the same time, this support will help Ukraine advance reforms and modernization necessary for progress towards future EU membership," said Vincent van Petegem, Minister of Finance of Belgium, which currently holds the EU Council presidency.

A condition for Ukraine's support under the fund will be its continued support for and respect of effective democratic mechanisms, including a multi-party parliamentary system and the rule of law, as well as guaranteeing respect for human rights, including the rights of minorities.

A system of indicators will be provided for assessing the implementation of the plan, which will help track progress in implementing various qualitative and quantitative steps, including reviewing the social, economic, and environmental aspects of the "Ukrainian Plan."

The preliminary agreement is subject to approval by the EU Council and the European Parliament before official adoption. After approval, it will be published in the Official Journal of the EU and will enter into force the following day. The regulation will be applied immediately upon its entry into force.