What is the Ukraine Facility?
To help Ukraine in its recovery, reconstruction and modernisation efforts, the EU will launch a new support mechanism for the years 2024 to 2027. The Ukraine Facility is a dedicated instrument which will allow the EU to provide Ukraine with up to €50 billion in stable and predictable financial support during this period.
The Facility underlines the EU’s commitment to supporting Ukraine in the face of Russia’s ongoing war of aggression and on its path towards EU membership.
Europe will be at Ukraine’s side for every single day of the war, and for every single day thereafter. Europe is true to its word. We will continue to deliver much-needed funding and predictability for our brave partner and aspiring member.
Aims of the Facility
Support Ukraine's recovery, reconstruction and modernisation
Support Ukraine’s financing needs to allow the government to deliver uninterrupted public services
Mobilise investments in Ukraine’s private sector for fast economic recovery and reconstruction
Support Ukraine to make the reforms needed on its path to EU accession
Support the broader Ukrainian society by helping to address the social consequences of the war
The government of Ukraine will prepare a plan that sets out its vision for the recovery, reconstruction and modernisation of the country, as well as the reforms it intends to take as part of the EU accession process.
If the conditions set out in this plan are deemed to be fulfilled, the EU will provide financial support of over €38 billion to Ukraine during the period 2024 to 2027 through a combination of loans (up to €33 billion) and grants.
The Facility will establish a specific framework to scale up investment for Ukraine’s recovery and reconstruction, worth €7 billion.
To achieve this, the framework will enable investors to take advantage of EU budget guarantees and a blend of grants and loans from public and private institutions which will make investing in Ukraine more attractive.
The Facility will introduce new assistance measures to help Ukraine align with EU laws and carry out the reforms necessary on its EU accession path. Technical assistance will be provided to authorities at national, regional, and local level, as well as to civil society organisations.
How will the support be financed?
To finance the loans to Ukraine, the European Union will raise up to €33 billion on the financial market until end of 2027 by issuing EU bonds under the unified funding strategy.
Grants will be financed through the EU annual budget under a new special instrument called the Ukraine Reserve. This instrument will be mobilised every year as part of the annual budget procedure to take into account the progress Ukraine makes in implementing reforms and using investments.
What are the conditions of the support?
To obtain the support, Ukraine must implement its recovery and reform plan and also uphold
- democratic mechanisms, including a multi-party parliamentary system
- the rule of law
- human rights, including the rights of persons belonging to minorities
Once the Commission can verify that the conditions have been fulfilled, payments to Ukraine will occur on a fixed schedule every quarter. While elements of the Facility are being put in place, the EU can provide immediate support to Ukraine of up to €1.5 billion per month for a limited period.
The European Commission and Ukraine will need to protect the EU’s financial interests by countering fraud, corruption and conflicts of interest. A dedicated Audit Board will assist the Commission by regularly reporting on the funds that are spent to achieve the Facility’s aims.
In addition, the European Council may hold a debate every year on the implementation of the Facility, based on a Commission report. If necessary, in two years' time the European Council will invite the Commission to make a proposal for a review of the Facility in the context of the next long-term EU budget. A regular Ukraine Facility Dialogue with the European Parliament will also take place at least every four months.
Timeline
- 24 April 2024
The Commission disburses the second instalment of exceptional bridge financing to Ukraine under the Ukraine Facility, amounting to €1.5 billion.
- 18 April 2024
The EU sets up the Ukraine Investment Framework to boost investments for the recovery and reconstruction of the country.
- 15 April 2024
The Commission endorses the Ukraine Plan, Ukraine’s comprehensive reform and investment strategy for the next 4 years.
- 20 March 2024
The Commission disburses the first €4.5 billion of bridge financing to Ukraine under the Facility.
- 6 February 2024
The European Parliament and the Council reach a political agreement on the Ukraine Facility, first proposed by the Commission in June 2023.