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EU to transfer over €2 billion more from frozen Russian assets to Ukraine

Author:
Iryna Perepechko
Date:

The EU will provide €2.1 billion in proceeds from frozen Russian assets to support Ukraine. The European Commission will receive them this week.

This is stated on the European Commission website.

This will be the second such transfer, covering revenues accumulated during the second half of 2024. The first tranche was in July 2024, when Ukraine received €1.5 billion.

These are excess profits received from frozen assets of the Central Bank of Russia, which are held by the Central Securities Depositories. The funds were frozen due to sanctions imposed by the EU in response to Russiaʼs full-scale war against Ukraine.

While the assets themselves remain blocked, the revenues they generate over time are used to support Ukraine. Funds from this tranche will be channeled through the European Peace Facility (EPF) and the Ukraine Facility

The Ukraine Facility is a €50 billion macro-financial assistance package for Ukraine, designed for four years. It was agreed by EU leaders on February 1, 2024. Ukraine will receive the money if it continues democratic reforms, guarantees a multi-party parliamentary system and the rule of law, and respects human rights.
to help strengthen Ukraine’s defense capabilities and contribute to the country’s recovery and reconstruction.

This measure is part of the EUʼs ongoing commitment to support Ukraine for as long as necessary. The next disbursements to Ukraine will be made mainly to enable it to repay the money it has already received under the ERA

ERA (Extraordinary Revenue Acceleration initiative) is a program launched by the G7 countries to raise money as quickly as possible to support Ukraine, mainly through loans. The EU participates in this program, in particular through its macro-financial assistance, i.e. large loans to Ukraine.
Ukraine must repay these loans. To help it do this, subsequent tranches from the EU will not go directly to new spending, but to repay previous debts received through the ERA.
initiative from the G7 countries. A small part of these funds will continue to flow through another fund, the European Peace Facility (EPF).

In addition, today Ukraine also received another loan from the EU of $1 billion — it will be repaid with the proceeds from frozen Russian assets. Thanks to this payment, total payments to Ukraine have reached €5 billion. The previous such tranche was in March this year.

New financial agreements between Ukraine and the EU

Also today, April 9, Ukraine and the EU signed five agreements. The package includes three financing agreements between the European Investment Bank and Ukraine for a total of €300 million.

Of this amount, €100 million will be allocated to three main areas:

  • investments in central heating, improving energy efficiency, purchasing equipment for electricity or heat production;
  • projects aimed at improving water supply and sanitation;
  • restoration of water, heat supply and sewage facilities, as well as modernization of basic social services in the areas of education, healthcare and the housing sector.

The European Commission says this will reduce the burden on public administration and help implement projects efficiently. The European Union is supporting this funding through the Ukraine Facility program.

The European Commission has also signed an agreement with Ukraine on participation in part of the Copernicus space programme, as well as in its Space Weather Events and Near-Earth Object sub-programmes. This will open up new opportunities for Ukraine, including access to the future Space Weather service, which will help protect Ukrainian satellites from disruptions caused by space weather phenomena. It will also be useful for post-war damage assessment and further reconstruction.

In addition, Ukraine has signed an agreement on joint procurement of medical supplies against serious cross-border health threats. Thanks to this agreement, all participants — including the EU and other candidate countries — will be able to jointly purchase medicines and medical supplies. For Ukraine, this means that it will be able to obtain the necessary medicines and medical supplies faster and more cost-effectively.

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