Romania to Allocate €50 Million to Ukraine for Repaying EU Loan Interest
The government of Romania will provide Ukraine with €50 million to cover the interest payments on the €18 billion EU loan approved for Kyiv by the EU Council and the European Parliament in December of the previous year, as reported by Romania-Insider.
The European Union lends money to Ukraine in the international capital markets, and interest accrues on these loans annually.
"Considering the challenging situation in Ukraine, the European Union is offering additional support from member states by covering the interest rate costs. The interest rate subsidy will be covered by member states through voluntary additional contributions," stated the Romanian government resolution.
The €50 million will be disbursed to Ukraine from the Romanian state budget in instalments between 2024 and 2027, averaging €12.3 million per year. National contributions were calculated based on each member country's share of the EU's Gross National Income (GNI) and were made with 'prudent assumptions regarding interest rates for raised funds.'
EU legislation, which approved the €18 billion loan for Ukraine, allows the Union to bear the interest costs, providing an interest rate subsidy, and to bear administrative expenses related to loan contracts and disbursements, excluding expenses related to the early repayment of the loan.
As reported by The Gaze, in October, the Cabinet of Ministers of Ukraine and the Romanian government agreed to build a cross-border car bridge over the Tysa River, connecting the cities of Bila Tserkva and Sighetu Marmatiei.
The European Commission welcomed this cooperation between Romania and Ukraine, believing it will further enhance the capacity of solidarity corridors, taking into account the damage inflicted on Ukraine's transportation infrastructure due to the war initiated by Russia in February 2022.
Currently, Romania plays a crucial role in the operation of solidarity corridors and actively collaborates with all involved parties.
It is worth noting that Romania and Ukraine previously signed agreements on grain transportation and defence industry cooperation. On October 18, Romanian Prime Minister Marcel Ciolacu, along with members of the current government, visited Kyiv, where the governments of both countries held a joint meeting, announced cooperation in various areas, and signed seven bilateral agreements.