European Commission disburses 260 mln to Ukraine under Macro-Financial Assistance
BRUSSELS. Nov 12 (Interfax) - The European Commission transferred 260 million euro to Ukraine on Wednesday as part of the European Union's Macro-Financial Assistance program.
This loan disbursement adds to the 600 million euro extended since May earlier this year under the two ongoing EU MFA programs. "Following's today's disbursement, this leaves 750 million euro remaining available under the two current programs for Ukraine," the EU said in a press release.
The objective of the MFA programs is "to support Ukraine economically and financially in the current difficult situation the Ukrainian economy is going through," while encouraging structural reforms that will improve governance, raise sustainable economic growth and promote legislative harmonization with the EU at a critical stage of its development, it said.
The European Commission raised the funding for the disbursement on the financial markets on November 5. The 660 million euro "benchmark bond was issued with 15-years maturity, and with yields at around 1.5%." These funds were also used to finance a European Financial Stabilization Mechanism (EFSM) loan to Portugal.
"The EU MFA loan support for Ukraine currently amounts to 1.61 billion euro. Two disbursements were made earlier this year: 100 million euro on 20 May and 500 million euro on 17 June," it said.
Further disbursements of 500 million euro and 250 million euro are intended to be made by the end of the year and by spring 2015, respectively, provided that "Ukraine shows satisfactory progress with the accompanying reforms."
"The assistance is part of a wider package of support for Ukraine announced by the European Commission on 5 March and endorsed by EU leaders at the European Council on 6 March 2014," it said.
MFA is an exceptional EU crisis-response instrument available to the EU's neighboring partner countries experiencing severe balance of payments problems. It is complementary to the assistance provided by the International Monetary Fund (IMF) and other donors in the context of the stabilization and reform program launched by the Ukrainian authorities.
