The European Commission on Thursday, on behalf of the EU, adopted the decision to release the second tranche of Macro-Financial Assistance (MFA) to Ukraine, a loan which amounts to EUR 600 million.
”With this disbursement, the total Macro-Financial Assistance that the EU has extended to Ukraine since 2014 will reach EUR 2.81 billion, the largest amount of Macro-Financial Assistance the EU has disbursed to any non-EU country,” the European Commission said in a press release.
Through the MFA program approved in April 2015 the EU has helped Ukraine to cover its external financing needs at the peak of the country`s balance-of-payments crisis. The program has also supported the implementation of a wide-ranging structural reform agenda.
Ukraine has largely fulfilled the policy commitments agreed with the EU for the release of the second payment of Macro-Financial Assistance. This included taking important measures to step up the fight against corruption, to foster greater transparency in public finance management, to modernize the public administration, to advance the ongoing reforms of the energy and financial sectors, to improve the business environment and to strengthen social safety nets. These structural reforms will benefit Ukraine`s citizens – the ultimate aim of the EU`s assistance.
Commission services will now raise the EUR 600 million on international capital markets, in order to then lend the funds on to Ukraine in late March or early April.
The EU will continue to work with the Ukrainian authorities to further the country`s reform agenda. This will imply further work on the social assistance to be provided to internally displaced persons in Ukraine – where Ukraine has already taken decisive steps – addressing certain trade-restrictive measures, energy sector reforms and the fight against corruption, among other elements. The Commission will continue to follow developments and monitor implementation closely. The Commission expects that the law on the timber export ban presented to the Ukrainian Parliament will be adopted without delay.
Macro-Financial Assistance has been made available to Ukraine for a period of 2.5 years expiring on January 4, 2018. It is therefore essential that Ukraine implements all policy measures agreed with the EU in a timely manner to ensure that the final disbursement can take place within the foreseen timeframe.