Wednesday, March 19, 2014

Europe offers further €1 billion in financial aid to Ukraine

The European Commission has proposed another 1 billion euro for Kiev, which will come as a part of the 11 billion euro package agreed earlier in March. Conditions for the new installment will be agreed in the coming weeks with the IMF.
A rapidly worsening balance-of-payments and weak fiscal situation in the wake of the latest developments in Ukraine pushed the EU to consider a new perk. 

"It is in the essential interest of Ukraine and of the EU to maintain peace and political and financial stability in our continent. This financial aid will help in stabilising the worsening financial situation in Ukraine and therefore will be one vital part of achieving a solution to the crisis," Olli Rehn, Vice-President of the European Commission responsible for Economic and Monetary Affairs and the Euro, said in a statement.

The new package is expected to be approved by the EU's Council of Ministers in the coming weeks.
  • The EU remained pretty vague on the exact terms of the financial aid.
The disbursement of the assistance would be conditional on the successful implementation of a financing arrangement that the Ukrainian authorities are expected to conclude with the IMF and on specific economic policy conditions that the Commission and the Government of Ukraine will agree on, both in the coming weeks,” it said.
It will come as a part of the 11 billion euro helping hand proposed by the European Commission on March 5, and would be implemented parallel to the existing 610 million euro programme, which has been available since 2010 but has not yet been released. 
http://rt.com/business/europe-offers-ukraine-aid-833/
19/3/14
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  •  Speaking points by Vice-President Olli Rehn on Macro-Financial Assistance to Ukraine. -European Commission....

Press Room, Brussels
Brussels, 19 March 2014
Good afternoon.
The College has this morning discussed the latest developments in Ukraine, especially concerning, obviously, the security and political situation but also touching upon economic and financial issues, and we have taken an important decision regarding financial help to the country.
As you are aware, the European Union has made clear that it does not recognise the outcome of the illegal and illegitimate referendum in Crimea and that the EU will not recognise the annexation of Crimea and Sevastopol to the Russian Federation, which indeed goes against the principles of the UN Charter and the CSCE/OSCE Helsinki final Act. The European Council will discuss the situation in Ukraine this week, as you know, and agree on a united European response to the latest developments.
While the focus in recent days has clearly been on these dramatic security and political developments, we should not forget that Ukraine's economic and financial situation has been deteriorating rapidly, which is felt in the everyday lives of Ukrainian citizens. There is a clear need for the international community to step in and provide urgent support. Creating the conditions for economic stabilisation is an essential step in order to help Ukraine to stabilise the political situation.
The Commission has been working intensively to prepare a package of macro-financial assistance to Ukraine, working in close cooperation with the IMF to mobilise the necessary support soon enough to help Ukraine meet its financing needs in the coming weeks and months.
Thus, today we adopted a proposal to provide Ukraine with a further one billion euros in macro-financial assistance, in addition to the already decided available MFA loan of €610 million. This €1.6 billion loan is an immediate and concrete response to Ukraine's difficult financial situation and is part of the package of support announced by the Commission on 5 March...................http://europa.eu/rapid/press-release_SPEECH-14-232_en.htm?locale=en
19/3/14

1 comment:

  1. US Federal Reserve watching Ukraine situation 'very closely'

    Federal Reserve Chair Janet Yellen said Wednesday that the US central bank is watching the situation in Ukraine "very closely" amid worries about an escalation in tensions.

    "We are not seeing broader global financial repercussions. But if this were to escalate, that would certainly be something that would be on our radar screen," she told reporters.......Read more: http://voiceofrussia.com/news/2014_03_20/US-Federal-Reserve-watching-Ukraine-situation-very-closely-1045/
    19/3/14

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