DRAFT BUDGETARY ASSESSMENT (COM(2024)0426 – C100106/2024 – 2024/0234(COD))
On the draft Establishing the Ukraine Loan Cooperation Mechanism and providing exceptional macro-financial assistance to Ukraine
BUDG-PA-763267
Committee on Budgets · Rapporteur: Janusz Lewandowski
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The Committee on Budgets assesses the draft regulation establishing the Ukraine Loan Cooperation Mechanism and macro-financial assistance, noting key features and requesting clarifications.¶¶¶ It calls on the Committee on International Trade to recommend approval of the proposal.¶
Committee position. The Committee on Budgets calls on the Committee on International Trade to recommend approval of the proposal.¶
Key points
- The mechanism provides non-repayable support to help Ukraine repay loans, funded mainly by amounts from Annex XLI of Council Regulation 833/2014 and voluntary contributions, up to EUR 45 billion.¶
- Ukraine must repay principal, interest and other costs of the MFA Loan or eligible bilateral loans.¶
- The macro-financial assistance provides support of up to 35 billion, pending other G7 contributions, with a duration of 45 years.¶
- The assistance has no grace period for repayment and no possibility for Ukraine to request interest rate subsidies covered by member states.¶¶
- Support is subject to a precondition, with consequences if not met or no longer met.¶
- The future Memorandum of Understanding must be consistent with the Ukraine Plan's qualitative and quantitative steps.¶
- Derogations mean the External Action Guarantee will not guarantee borrowing, and no provisioning rate is set, using the headroom instead.¶¶
- The MFA Loan Agreement must include provisions for early repayment if Ukraine engages in fraud, corruption or illegal activity.¶
- Repayment modalities include a waterfall structure, and information must be transmitted to Parliament and Council in the annual budgetary procedure.¶¶
- The committee regrets lack of clarity on final budget liability and requests clarification on overlaps with the Ukraine Facility and aggregation of liabilities.¶¶¶
- Ukraine's needs exceed previous IMF estimates, making previous support insufficient, especially for 2026 and 2027; a new MFF amendment would be needed to extend treatment of assistance.¶¶
- The committee regrets the urgency stemming from the Commission's lack of flexibility on the MFF amendment.¶