The European Parliament's Committee on Trade has approved an initiative to provide €35 billion in loans to Ukraine, marking a significant step in the European Union's support for the country. The loan is intended to be repaid using profits generated from frozen Russian assets, aligning with broader international efforts to leverage these funds for Ukraine's benefit.
During the committee's consideration of the European Commission's proposal, 31 members voted in favor of the loan, while four members opposed it. This financial package is part of the EU's contribution to the G7 initiative to provide Ukraine with $50 billion, sourced from the profits of Russia's frozen assets.
The proposal will next be presented to the full European Parliament during its session from October 21-24. Following parliamentary approval, the Council of the EU is expected to endorse the loan through a written procedure. The decision will come into effect the day after its publication in the Official Journal of the EU.
This substantial financial support opens up numerous investment opportunities in Ukraine's financial sector, especially for those interested in contributing to the country's economic recovery and development. The infusion of funds is anticipated to strengthen Ukraine's energy infrastructure and defense capabilities, sectors that are critical for its stability and growth.
Background
In late September, Ursula von der Leyen, President of the European Commission, announced during her visit to Kyiv that the EU would provide Ukraine with a €35 billion loan. Notably, Ukraine will not be required to repay this loan directly; instead, it will be covered by profits from frozen Russian assets.
Ukrainian President Volodymyr Zelensky stated that the funds would be directed toward enhancing the country's energy sector and meeting defense needs. On October 9, it was reported that the Council of the EU had approved the European Commission's loan initiative for Ukraine, moving the process closer to finalization.
Next Steps
- October 21-24: The European Parliament will deliberate on the loan during its session.
- Post-Approval: Following the Parliament's approval, the Council of the EU will formalize the decision.
- Implementation: The decision will take effect the day after it is published in the Official Journal of the EU.
