Wednesday

26th Jul 2017

Barroso proposes €11bn to 'stabilise' Ukraine

  • Barroso: 'the situation in Ukraine is a test of our capability and resolve to stabilise our neighbourhood' (Photo: ec.europa.eu)

European Commission head Jose Manuel Barroso has proposed almost €11 billion in new money to help stabilise post-revolutionary Ukraine.

With EU leaders at an emergency summit in Brussels on Thursday (6 March) to discuss his ideas, he said on Wednesday: “I think everybody knows what is at stake here: For the first time in many years, we in Europe feel a real threat to our stability, and even to peace on this continent.”

Thank you for reading EUobserver!

Subscribe now and get 40% off for an annual subscription. Sale ends soon.

  1. €90 per year. Use discount code EUOBS40%
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

He added: “Ladies and gentlemen, the situation in Ukraine is a test of our capability and resolve to stabilise our neighbourhood.”

One billion euros of the new money is to come in the form of loans, paid from the EU budget, for Ukrainian macro-financial assistance.

Another €1.4 billion will come as EU grants over the next seven years. The European Investment Bank is to contribute €3 billion over 2014 to 2016 and the European Bank for Reconstruction and Development is to add €5 billion.

In other measures, the commission will add a previous pledge of €610 million of macro-financial loans. It will also try to leverage €250 million of previously-earmarked Ukraine cash to raise over €3.5 billion in loans.

Barroso noted the money will be conditional on reforms already set out by the International Monetary Fund (IMF), which include raising household gas prices.

But in return, the IMF, the World Bank, EU member states, and other countries, such as Canada, Japan, South Korea, and the US are expected to top up the EU offer.

The EU's €11 billion is almost equal to a $15 billion bailout offered by Russia before the Ukraine uprising broke out, but the top-ups could see it climb much higher.

Meanwhile, Barroso said the macro-financial aid and some €600 million of the new grants can be paid out “very fast … within a matter of weeks.”

He also proposed that EU countries should immediately apply lower trade tariffs on Ukrainian imports, as envisaged in a future free trade agreement.

He urged the Union to also get ready to pump gas to Ukraine in “reverse flows” through Soviet-era pipelines to reduce its dependency on Russian imports.

The commission offer and the EU summit come after a popular revolution toppled Ukraine’s former president Viktor Yanukovych in February, prompting Russian forces to occupy Ukraine’s Crimea region.

EU countries are expected to trigger an asset freeze and visa bans on Yanukovych, his two sons, and 15 other former regime members on Thursday morning.

They have threatened to impose similar measures against Russia if it does not pull back troops in Ukraine, but an EU diplomat said it is “too early” to draft a list of Russian names at this stage.

EU leaders on Thursday are also likely to call for international, but not EU, monitors in Crimea, after Germany, Italy, and the UK, spoke out against an EU mission at a foreign ministers’ meeting on Monday.

For its part, the Russian parliament is drafting a bill to let the Kremlin confiscate European companies’ assets if the EU goes ahead.

The EU diplomat said the result of the summit will depend, to an extent, on the outcome of talks between the British, French, German, Russian, and US foreign ministers in Paris on Wednesday.

The contact added: “There is interdependence. If we are going to enter a real sanctions game, a pain game, then it is difficult to say which side will hurt more.”

Opinion

Ukraine: The Empire strikes back

If the international community allows Russia to partition Ukraine despite the Budapest treaty, it will send a terrible signal.

Journalists on trial highlight Turkey crackdown

The trial, which opened Monday, of 17 journalists and administrative employees of the daily newspaper Cumhuriyet is considered one of the most important episodes in a systematic campaign to silence dissent.

Opinion

Stronger EU-Egypt ties must not disregard human rights

The EU’s apparent willingness to water down its stance on human rights in Egypt could seriously compromise its credibility and have far-reaching consequences for its relations with other countries in the region.

Stakeholders' Highlights

  1. EU2017EELocal Leaders Push for Local and Regional Targets to Address Climate Change
  2. European Healthy Lifestyle AllianceMore Women Than Men Have Died From Heart Disease in Past 30 Years
  3. European Jewish CongressJean-Marie Le Pen Faces Trial for Oven Comments About Jewish Singer
  4. ACCAAnnounces Belt & Road Research at Shanghai Conference
  5. ECPAFood waste in the field can double without crop protection. #WithOrWithout #pesticides
  6. EU2017EEEstonia Allocates €1 Million to Alleviate Migratory Pressure From Libya in Italy
  7. Dialogue PlatformFethullah Gulen's Message on the Anniversary of the Coup Attempt in Turkey
  8. Martens CentreWeeding out Fake News: An Approach to Social Media Regulation
  9. European Jewish CongressEJC Concerned by Normalisation of Antisemitic Tropes in Hungary
  10. Counter BalanceOut for Summer Episode 1: How the EIB Sweeps a Development Fiasco Under the Rug
  11. CESICESI to Participate in Sectoral Social Dialogue Committee on Postal Services
  12. ILGA-EuropeMalta Keeps on Rocking: Marriage Equality on Its Way

Latest News

  1. EU defends airline data-sharing after court ruling
  2. Stop blaming Trump for Poland’s democratic crisis
  3. EU and US scrap on Russia sanctions gets worse
  4. Czechs, Hungarians, and Poles have one month to start taking migrants
  5. EU Commission sets red lines for Poland on Article 7
  6. Court told to 'dismiss' case against EU migrant quotas
  7. Russia's EU pipeline at 'risk' after US vote
  8. EU Commission to act on Poland