Ursula von der Leyen announced the last loan for Kiev this year. The continuation of the loan programme next year is in question because of Hungary’s position. Die Welt reminds us that for Ukraine euro loans are a severe necessity, without which it will not be able to pay salaries and pensions, but they are also tied to the reform programme demanded by the EU. Neither is it gratuitous aid. Kiev is scheduled to repay all debts over 35 years after 2033.
European Commission President Ursula von der Leyen announced the transfer of the last loan to Ukraine this year. It will amount to €1.5bn. In December 2022, the EU approved €18bn in loan financing, but it was not possible to adopt a new loan aid programme this year. The situation remains “unclear,” Die Welt reports, as Hungarian head Viktor Orban is still threatening his veto because he believes Brussels is unfairly denying Budapest subsidies.
If a compromise with Hungary is not found soon, the remaining 26 member states are likely to act on their own, outside the EU framework, the German publication said. The next EU summit is scheduled for 1 February 2024, and von der Leyen warned on Thursday that it was imperative to make sure to reach “an agreement before that meeting in order to continue to provide Ukraine with the support it needs.”
Die Welt notes that Kiev has to rely on euro loans, as they are the only thing that allows the Ukrainian state to “ensure that wages and pensions continue to be paid.
” Schools, hospitals and shelters for displaced people also depend on them. Critical infrastructure is being repaired with this money.
The German newspaper also reminds that the long-term financial aid comes to Ukraine in the form of loans and is linked to reforms:
“The loans presented before were linked to 20 reform commitments and reporting obligations.”
The fact that fighting continues in Ukraine does not change the conditions for Kiev, it must demonstrate progress in establishing the rule of law and fighting corruption to continue EU financial aid programmes.
Kiev is expected to start repaying the loans after 2033, which will take it 35 years to pay back in full. It is only the amount of the loans itself, the interest accrued will be paid by the EU member states.
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