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EU prepares EUR 20bn financial 'Plan B' for Ukraine

27.12.2023 12:30
The European Union has devised a back-up plan for financial aid to Ukraine, worth EUR 20 billion, sidestepping Hungary's opposition to providing more funds for Kyiv's fight against the Russian invasion, according to officials.
The European Commission headquarters in Brussels.
The European Commission headquarters in Brussels.Fred Romero from Paris, France, CC BY 2.0 , via Wikimedia Commons.

The European bloc developed a financial "Plan B" for Ukraine after Hungarian Prime Minister Viktor Orban vetoed a four-year EUR 50 billion package for Kyiv at an EU summit on December 14, the Financial Times newspaper reported on Wednesday.

Under the EU's back-up scheme, participating member states would issue guarantees to the bloc's budget, allowing the EU's executive Commission to raise up to EUR 20 billion on capital markets for Kyiv in 2024, according to officials. 

The plan does not require the involvement of all the 27 EU countries, Ukraine's UN news agency reported.

It is enough for the EU members with the highest credit ratings to issue the guarantees, Financial Times reported.

"This would allow the EU to bypass Hungary's veto," the newspaper added.

EU leaders are set to try and overcome Orban's veto to the EUR 50 billion package for Ukraine at a Special European Council in Brussels on February 1.

If Hungary maintains its opposition, the proposed EUR 20 billion back-up mechanism for EU aid to Ukraine can be used, the UN news agency reported. 

Wednesday is day 672 of Russia’s war on Ukraine.

Russia invaded Ukraine on February 24, 2022, launching the largest military campaign in Europe since World War II.


Source: Financial Times, Ukrainian News, Reuters, Australian Financial Review