Brussels, 19 May 2022 (TDI): The EU Commission presented plans for the EU’s immediate response to address Ukraine’s financing gap and the framework for longer-term reconstruction.
The 🇪🇺 stands united in its unwavering support to 🇺🇦 – throughout this war and when they start rebuilding.
We continue helping our friend and neighbour to resist Russia’s aggression.
In the long term, we stand ready to help rebuild a prosperous Ukraine. #StandWithUkraine
— European Commission 🇪🇺 (@EU_Commission) May 19, 2022
The European Council called for addressing the consequences of the war in Ukraine through a dedicated Europe-led effort.
In addition, the EU reaffirmed its unwavering support to Ukraine, that is, throughout the ongoing war as well as when it begins rebuilding.
That is, for the long term they are ready to assist in rebuilding a prosperous Ukraine.
Therefore, it stated that they continue in helping their neighbor and friend to counter Russia’s aggression.
Immediate response and short terms needs
From the beginning of the war, the EU has significantly increased its support for Ukraine.
Thus, it has mobilized about 4.1 billion euros intended to support Ukraine’s economic, social and financial resilience in the form of macro-financial help, budget support, emergency assistance, crisis response, and humanitarian aid.
Furthermore, military help measures have been made available under the European Peace Facility.
As a result, it has amounted to 1.5 billion euros and will be utilized to compensate member states for their in-kind military support.
Likewise, the Commission stated that an additional amount of 500 million euros is in progress.
Moreover, the ongoing war has led to the collapse of taxes, export, and other revenues.
According to the International Monetary Fund, Ukraine’s balance of payments gap until June is estimated at approximately 14.3 billion euros.
In order to address the significant short-term financial support to sustain basic services, address humanitarian needs, and fix the most essential destroyed infrastructure in Ukraine, it will need a joint international effort.
Therefore, the Union stated that it will be ready to play its role.
Also, the Commission envisions to propose granting Ukraine additional macro-financial assistance in the form of loans of up to €9 billion in 2022.
Thereby, it will be complemented by support from other bilateral and multilateral international partners that include the G7.
Reconstruction of Ukraine
The Commission highlighted that there will be a requirement for a major global financial effort to rebuild Ukraine after war damages.
However, the entire needs for reconstructing Ukraine are unknown at the moment.
Furthermore, the efforts of reconstruction have to be led by the authorities of Ukraine.
Thus, also in close partnership with the EU, important partners, third countries, international organizations, and financial institutions.
Partnerships among cities and regions in the EU and Ukraine will enhance and speed up reconstruction.
Moreover, the ‘Rebuild Ukraine’ reconstruction plan is founded on a needs assessment.
As a result, it will be the starting point for the EU and other partners to find out the priority areas chosen for financing and projects that are specific.
In conclusion, there will be coordination of the financing sources and their destination to enhance their use and inspect progress in the implementation of the plan.