European Parliament Supports Allocation of €50 Billion to Ukraine

During a vote on Tuesday, 17 October, the European Parliament supported the European Commission's initiative to create a €50 billion fund to help Ukraine.

As the press service of the European Parliament reported, the proposal received 512 votes in favour, 45 votes against and 63 abstentions.

Negotiations with EU member states can begin as soon as the EU Council agrees on a common position.

This is a new instrument, the Ukraine Facility, which provides €50 billion in grants and loans for 2024-2027 to support Ukraine's recovery, reconstruction and modernisation. This proposal was made by the European Commission in June 2023. 

One of the key demands of MEPs is to use frozen Russian assets to recover Ukraine. It is also a safeguard against corruption, fraud and other violations in the use of European funds in Ukraine. Among other things, MEPs stressed that companies with oligarchic influence should not receive funding. 

During consideration in the committees, some changes were made to the bill to make it more transparent. In particular, it provides for the creation of a separate website on the funds allocated to Ukraine for specific purposes and the steps that Ukraine has taken to receive assistance. MEPs want contributions from third countries and international institutions to be published as well.

The €50 billion programme for Ukraine is part of the revision of the EU's long-term budget in response to a number of crisis events that occurred after 2021. MEPs believe that this instrument should be approved as soon as possible, as part of the overall budget review, so that when the current calendar year ends, there will be a clear source of funding to support Ukraine. It should also be included in the annual budget for 2024, which will be negotiated in November.

According to media reports, Hungary wants to divide this support package and proposes to initially agree on €25 billion.

In June, the European Commission proposed to create a special instrument, the Ukraine Facility, with a budget of up to €50 billion for the period from 2024 to 2027 in the form of grants and loans.

This fund will replace the bilateral support currently provided by the EU under the Global Europe Neighbourhood, Development and International Cooperation Instrument (NDICI) and the €18 billion MFA+ programme, which expires at the end of 2023.