EU Proposes €35 Billion Loan to Aid Ukraine Amid Ongoing Conflict

The European Commission has proposed a €35 billion loan for Ukraine to address its increasing needs due to Russian aggression. Announced by Ursula von der Leyen in Kyiv, the loan is part of a wider G7 plan and requires approval from the European Parliament and member states to proceed.

The European Commission has proposed a significant loan of up to €35 billion ($39 billion) for Ukraine, aimed at covering the urgent needs arising from Russian attacks on its infrastructure. The announcement was made by Commission President Ursula von der Leyen during her visit to Kyiv.

Von der Leyen emphasized the necessity of continuous EU support for Ukraine amidst relentless Russian aggression. The proposed loan is part of a broader G7 initiative to utilize frozen Russian assets. It still requires the green light from the European Parliament and the approval of a qualified majority of the EU's 27 member governments.

Ukraine's financing demands are predicted to surge to €38 billion by 2025, significantly higher than previous estimates. The new mechanism, dubbed the Ukraine Loan Cooperation Mechanism, is designed to issue and manage these loans, partly funded by profits from frozen Russian assets. The proposal package includes extending the freeze on central bank assets to 36 months, requiring unanimity among member states.

(With inputs from agencies.)