An agreement was reached among the 27 EU countries on the €35 billion macro-financial assistance loan to Kiev, which will be serviced and repaid from windfall proceeds from frozen Russian assets.

The agreement was reached today at the EU’s Council of Permanent Representatives (Coreper).

In a statement, the EU Council highlights that the EU today reached an agreement on a financial assistance package for Ukraine, including an emergency macro-financial assistance loan of up to €35 billion and a loan cooperation mechanism that will support Ukraine in repaying loans up to €45 billion ($50 billion) from the EU and G7 partners.

The financial assistance aims to provide immediate relief to Ukraine’s urgent financial needs that have increased due to Russia’s escalating aggression towards Ukraine.

Repayment of the extraordinary loan and eligible bilateral loans from G7 partners under the Extraordinary Revenue Acceleration Loans for Ukraine (ERA) initiative will be secured by funds from future extraordinary revenue flows from the freezing of Russian state assets elements.

The Ukraine Loan Facility will disburse these funds – as well as possible amounts received as voluntary contributions from Member States and third countries or other sources – in the form of financial support to Ukraine, to help it service and repay the loans.

The loan of up to €35 billion is the EU’s contribution to the G7 loan of up to €45 billion (or $50 billion).

In order to ensure that macro-financial assistance reaches Ukraine as soon as possible, Member States agreed that if the European Parliament approves the Commission’s proposal without changes, the Council will also proceed to approve the text without amendments.

The Council plans to adopt the regulation by written procedure after the European Parliament approves the text at first reading. The regulation is expected to enter into force the day after its publication in the Official Journal of the EU.

The aim is to dispose of the loan in 2024, with disbursement in 2025, to be repaid over a maximum period of 45 years.

It is recalled that the G7 leaders agreed in June 2024 to provide a loan of up to 50 billion dollars (45 billion euros) for Ukraine before the end of 2024 with revenues derived from frozen Russian state assets through the so-called “Emergency Initiative “Extraordinary Revenue Acceleration Loans for Ukraine – ERA”. This agreement was confirmed by the Member States at the European Council meeting on 27 June 2024. The financial package agreed today implements these commitments.

EU borrowing to finance the emergency loan to Ukraine will be backed by a guarantee from the EU budget.