Europe development bank raises 1 billion euros for Ukraine

By: AFP
Published: 07:28 PM, 12 May, 2022
Europe development bank raises 1 billion euros for Ukraine
Caption: Europe development bank raises 1 billion euros for Ukraine
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The European development bank raised one billion euros ($1.04 billion) in aid for Ukraine at its annual meeting this week, the institution's president said Thursday.

The money comes on top of two billion euros in a "resilience package" that was launched by the European Bank for Reconstruction and Development (EBRD) at the start of Russia's invasion of Ukraine.

"Donors have expressed the intention" to provide one billion euros to the bank "in response to the war on Ukraine", EBRD president Odile Renaud-Basso said at a news conference in the Moroccan city Marrakesh.

The EBRD forecast this week that the Ukrainian economy will shrink by 30 percent this year, more than previously estimated.

The World Bank expects the country's economy to shrink by an even larger 45 percent.

"Ukraine needs our help to support vital infrastructures, to maintain access to electricity and transport, railways," Renaud-Basso said. 

"Ukrainian municipalities need support to cope with large numbers of displaced refugees," she said.

"The Ukrainian economy needs the money to support companies and try to keep going within the world economy, which is crucial, for example, for the food security of many countries," the EBRD head said, referring to Ukraine's role as a major exporter of wheat and sunflower.

Major challenge

Ukraine estimates that it needs around $5 billion per month just to cover its budget deficit.

It also wants donors to focus also on its future reconstruction.

Ukraine's Finance Minister Sergiy Marchenko had urged international donors to "maximise" efforts to help his nation in a video link address to the EBRD on Wednesday.

Kyiv can only cover about 62 percent of primary budget needs excluding military expenditure, Marchenko said.

Ukraine has been pushing Western countries for more support.

US lawmakers voted Tuesday to send a $40-billion aid package to Ukraine.

If the package passes the Senate as expected, US spending to bolster Ukraine's defences and address the ensuing humanitarian crisis will soar to around $54 billion.

European Union's economy commissioner Valdis Dombrovskis told the EBRD meeting this week that rebuilding Ukraine will be a "major challenge" and that quantifying the cost was not possible as "the damage continues every day".

The bloc was willing to "provide large and very meaningful support for those reconstruction needs", he added.

The EU was also examining how it could link support with structural reforms "which Ukraine may need, potentially as an EU candidate country", Dombrovskis said.

The bloc is due to give an opinion on Ukraine's accession bid next month.

AFP

Agence France-Presse is an international news agency.