After European Union leaders failed to reach an agreement on a four-year, 50 billion euro package, alternatives were sought to save Kiev from a looming budget crisis in case differences within the European Union cannot be resolved.
One model, financed by a loan, is seen as the most practical way to provide support to Ukraine if Orbán refuses to give up his veto at a summit scheduled for February 1, officials involved in the talks said.
Under this scheme, participating member states would provide guarantees to the European Union budget, which would allow the European Commission to borrow up to 20 billion euros from capital markets for Kiev next year, sources close to the discussions said. The exact terms are still under discussion and the final amount could be determined based on Ukraine’s needs, the sources said.
No guarantees are required from all 27 member states of the European Union as long as the main participants include the countries with the best credit ratings. This allows Hungary’s veto to be circumvented as it does not require unanimous support.
Some countries, including Germany and the Netherlands, require parliamentary approval for national guarantees. The process to obtain it is expected to be completed in time to provide aid to Ukraine by March.
If European Union leaders reach an agreement on the plan on February 1, it will encourage the International Monetary Fund (IMF) to release the next tranche of financing for Ukraine worth around $900 million, the sources say.
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2023-12-27 09:06:16
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