EU signs first guarantee agreements for €1.4 billion under the Ukraine Facility

The EU has signed the first guarantee agreements worth €1.4 billion under the investment component of the Ukraine Facility program. This was announced by First Vice Prime Minister and Minister of Economy Yulia Svyrydenko during the Ukraine Recovery Conference-2024 in Berlin.

As noted, the Ukraine Investment Framework has been launched to help accelerate the country’s recovery, including energy infrastructure.

According to Svyrydenko, the EU’s financial assistance is one of the factors that has helped the Ukrainian economy to show recovery growth in the face of war.

«After a record drop of almost 30%, last year we already had a GDP of +5.3%. For the growth to continue, we need to quickly restore the destroyed infrastructure, including the energy infrastructure, which has been mercilessly destroyed by the enemy in recent months, but most importantly, we need to attract investment in the private sector, help businesses operate and develop. This will be facilitated by the first €1.4 billion agreements signed with international and bilateral financial institutions under the Ukraine Investment Framework,” the First Vice Prime Minister said.

The new agreements include €1 billion in loan guarantees and €400 million in mixed financial grants. According to the Ministry of Economy, they will benefit private companies, including small and medium-sized enterprises (SMEs), municipalities and Ukrainian state-owned enterprises, and will focus on the repair, reconstruction and development of energy infrastructure.

Other programs are aimed at the transport and municipal sectors, and access to finance for small and medium-sized enterprises, including those affected by the war in the de-occupied and frontline regions.

The Ministry of Economy also provided a full list of programs aimed at unlocking €6 billion in investments for the country. Among them, in particular, are initiatives to support Ukraine’s private sector – expanding access to finance for SMEs, providing urgent support to companies affected by the war. Under this program, the EU provides €190 million in guarantees and €10 million in investment grants through the European Investment Bank (EIB).

In April 2024, the European Commission approved the Ukraine Facility Plan and proposed that the EU Council adopt the document. The Ukraine Facility was approved on March 1 this year, providing stable financing of up to €50 billion in grants and loans to support the recovery, reconstruction and modernization of Ukraine for 2024-2027.