EU pays further billion euro to Ukraine, to be repaid using immobilised Russian assets

The European External Action Service (EEAS) said on April 10 that the EU has paid out an additional one billion euro tranche of its exceptional Macro-Financial Assistance (MFA) loan to Ukraine, to be repaid with proceeds from immobilised Russian State assets in the EU, “reinforcing the EU’s role as the largest donor since the beginning of Russia’s war against Ukraine.”

This payment brings the total MFA disbursements to Ukraine to five billion euro, the EEAS said.

The EU’s 18.1 billion euro MFA forms part of the G7-led Extraordinary Revenue Acceleration (ERA) initiative, which aims to provide around 45 billion euro in support to Ukraine.

“This funding addresses Ukraine’s urgent budgetary needs, which have grown due to Russia’s ongoing war of aggression,” the EEAS said.

“It will help Ukraine sustain military and reconstruction efforts, including the repair of critical infrastructure like energy, water, and transport systems,” it said.

The European Commission (EC) said that it stands ready to frontload the remaining MFA funds in line with the country’s needs, as called for by the European leaders in the Special European Council in early March.

This week the Commission will receive 2.1 billion euro due in windfall profits generated from immobilised assets of the Russian Central Bank, held by the Central Securities Depositories.

The receipt of this amount will mark the second transfer of its kind, following a first tranche delivered in July 2024.

It covers revenues accumulated during the second half of 2024.

These funds come from assets of the Russian Central Bank which are immobilised under EU sanctions imposed in response to Russia’s ongoing war of aggression against Ukraine. While the assets themselves remain blocked, the extraordinary revenue they generate over time are used to support Ukraine.

The proceeds from this tranche will be channelled via the European Peace Facility (EPF), as agreed by the Council in 2024, and the Ukraine Facility to help strengthen Ukraine’s defence capabilities and contribute to the country’s recovery and reconstruction.

“This measure is part of the EU’s continued commitment to stand with Ukraine for as long as it takes,” the EEAS said.

Subsequent tranches will be provided to Ukraine principally to enable it to ensure the repayment of the funds it receives from the G7-led Extraordinary ERA initiative, while a limited portion will continue to be channelled through the EPF.

In the margins of the Association Council between Ukraine and the EU on April 10, five agreements were signed, the EEAS said.

These include three finance contracts worth 300 million euro between the European Investment Bank and Ukraine, supporting key operations that address Ukraine’s most pressing recovery needs.

The funding will empower local actors to swiftly rebuild essential infrastructure such as water systems and energy-efficient facilities, alleviating pressure on government administration while ensuring effective delivery.

Backed by the EU through the Ukraine Facility, “these projects reflect our steadfast commitment to Ukraine’s recovery and long-term resilience. They will deliver tangible benefits to people and businesses across the country at a time when they are most needed,” the EEAS said.

In addition, the Commission signed an agreement on Ukraine’s participation in the Copernicus component, as well as in the Space Weather Events and Near-Earth Object sub-components of the EU Space Programme. This agreement will bring significant benefits to Ukraine—for example, access to the future Space Weather service, which will protect Ukrainian satellites from disruptions caused by space weather events.

It also plays a crucial role in post-war damage assessment and reconstruction, as the EU Space Programme includes some of the most advanced space technologies, the EC said.

Ukraine also signed the agreement on the procure medical countermeasures against serious cross-border health threats, which allows all signatories, including the EU and other candidate countries, to jointly procure medical countermeasures.

“Ukraine will gain faster, more equitable, and often more affordable access to essential medicines and medical products, ensuring protection for their citizens and patients in times of health emergencies.”

A major business summit co-hosted by the European Commission, the Ukrainian government, the Polish Presidency of the EU Council, and Italy, will also take place is taking place.

The EU-Ukraine Business Summit aims to support Ukraine’s reconstruction and reform efforts, with over 700 stakeholders attending to discuss ways to strengthen the country’s business climate and unlock investment.

On this occasion, European Commissioner Marta Kos and Ukrainian Prime Minister Denys Shmyhal will launch a new EU-Ukraine Business Partnership. This initiative seeks to deepen economic ties between the EU and Ukraine, accelerating the country’s recovery and supporting its path to EU accession and integration into the EU Single Market.

During this event, the EC will also announce a new call for expressions of interest, encouraging EU companies to invest in Ukraine’s reconstruction. The call will be open until October 10 2025, and will include opportunities for joint ventures with Ukrainian partners, the EEAS said.

(Photo: EC Audiovisual Service)