The Commission welcomes the consensus reached by the EU and G7 partners to collectively provide loans for €45 billion to support Ukraine's urgent budgetary, military and reconstruction needs (approximately $50 billion USD). This confirms that the EU and G7 partners fulfil the commitment they made in June at the Apulia G7 Leaders' Summit. These loans will be serviced and repaid by future flows of extraordinary revenues stemming from the immobilisation of Russian Central Bank assets.

This achievement underscores the unwavering commitment of the EU and its G7 partners to support Ukraine in its fight for its freedom, recovery and reconstruction.

An EU mechanism for the repayment of the loans

The consensus amongst G7 members was facilitated by the EU's creation of the Ukraine Loan Cooperation Mechanism. This mechanism, recently endorsed by co-legislators following a proposal of the Commission, will receive extraordinary revenues stemming from
the immobilisation of Russian sovereign assets and other voluntary contributions made by Member States or third countries.
These resources will then be distributed to Ukraine to repay the principal and interest on eligible bilateral loan agreements with lenders under the G7 ‘Extraordinary Revenue Acceleration (ERA) Loans for Ukraine' initiative. 

To ensure that Ukraine would receive the full amount of financing committed by G7 Leaders, the EU showed leadership by providing the authorisation to contribute to this initiative with an exceptional EU macro-financial assistance (MFA) loan of up to €35 billion.

In light of the confirmed contributions of G7 partners, ensuring support proportionate to the size of their respective economies, the EU expects to provide an MFA loan of approximately €18 billion as its contribution to the ERA initiative. Through this new exceptional MFA operation that is additional to the support provided by the EU under the €50 billion Ukraine Facility, Ukraine will be able to benefit from predictable, continuous, orderly and timely support that will contribute to cover a sizeable share of Ukraine's budgetary needs.

Next steps

Following the swift adoption by co-legislators of the Commission's proposal this week, the EU will work with Ukraine and G7 partners to operationalise the Ukraine Loan Cooperation Mechanism and MFA loan by the end of this year. This would allow paying out the new EU macro financial assistance to Ukraine in 2025. 

Background

Since the beginning of Russia's war of aggression against Ukraine, the EU, together with its Member States, has unequivocally condemned Russia's actions and has offered unprecedented support to Ukraine and its people. The EU, its Member States and European Financial Institutions have together provided nearly €122 billion in grants and loans, supporting the Ukrainian war effort and its economy, helping to maintain basic services and offer early reconstruction, humanitarian assistance and help to those fleeing the war in the EU.

For More Information 

G7 Leaders' Statement on Extraordinary Revenue Acceleration (ERA) Loans

G7 Finance Ministers' Statement on Extraordinary Revenue Acceleration (ERA) Loan Initiative

G7 Summit Statements

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing the Ukraine Loan Cooperation Mechanism and providing exceptional macro-financial assistance to Ukraine

Council greenlights up to €35 billion in macro-financial assistance to Ukraine and new loan mechanism implementing G7 commitment - Press release

Parliament approves up to €35 billion loan to Ukraine backed by Russian assets - Press release

European Council, 27-28 June 2024 - Audiovisual Package 

Quote(s)

Russia must end its illegal war of aggression and pay for the damage it has caused. The EU has made the G7 pledge a reality. Together, we'll support Ukraine with €45 billion from Russia’s immobilised assets. We're steadfast in our solidarity
with Ukraine’s fight for freedom.

Ursula von der Leyen, President of the European Commission

I welcome today’s G7 decision to implement the agreement on financial support
to Ukraine from proceeds of Russian immobilised assets. This is an important next step in making Russia pay for the damages that their illegal aggression is causing in Ukraine. The EU is a major contributor to this initiative, a testament to our unwavering support to Ukraine. We are now working to ensure that Ukraine can receive this financial support by the end of this year. 

Executive Vice-President Valdis Dombrovskis

Today’s G7 agreement is an unmistakable signal of unity, highlighting our strong common commitment to support Ukraine in its struggle for freedom and democracy and to make Russia pay for its brutal aggression. EU leadership was essential to reach this result. Together, we stand by Ukraine’s side, ensuring it has
the resources needed to meet urgent budgetary, military, and reconstruction needs
in these challenging times. 

Paolo Gentiloni, Commissioner for Economy