14:55 03.12.2014

EU allocates EUR 500 mln in macro-financial assistance to Ukraine

2 min read
EU allocates EUR 500 mln in macro-financial assistance to Ukraine

The European Commission has completed the provision of a loan to Ukraine as part of the second program of macro-financial assistance, the commission's press service has reported.

The European Commission on Wednesday disbursed EUR 500 million to Ukraine, which is the second and final loan tranche of the EU's EUR 1 billion macro-financial assistance (MFA II) program for Ukraine approved earlier this year.

The press service noted that the objective of the MFA programs is to support Ukraine financially while encouraging important structural reforms aimed at improving governance, delivering sustainable economic growth and supporting legislative harmonization with the EU.

Specifically, the MFA supports reforms in the areas of public finance management and anti-corruption, trade and taxation, the energy sector and the financial sector.

The funding for the disbursement was raised by the European Commission on financial markets on November 26, by increasing an already existing 15-year-bond. For the EU, this tap marked a new historical record-low yield of 1.363%. The funds have been on-lent to Ukraine on effectively the same terms.

As reported, the EU MFA loan support for Ukraine currently amounts to EUR 1.61 billion.

The European Commission transferred EUR 100 million to Kyiv on May 20, 2014 as part of the first aid program, EUR 500 million on June 17 as part of the second aid program and EUR 260 million on November 12 as part of the first aid program.

Another EUR 250 million as part of the first macro-financial assistance program is to be transferred to Kyiv in the spring of 2015.

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