European commission offers 11bn euros to Ukraine

European Commission president Jose Manuel Barroso on Wednesday announced a massive aid package to Ukraine of “at least 11 billion euros over the next couple of years.”

“It is a package designed to assist a committed, inclusive and reforms-oriented Ukrainian government,” Barroso said.

“The package combined could bring an overall support of at least 11 billion euros ($15 billion) over the next couple of years, from the EU budget and EU based international financial institutions,” the head of the EU executive told a news conference.

He said he would discuss details of the assistance in Brussels on Thursday with interim Prime Minister Arseniy Yatsenyuk, who will be attending an emergency summit of the EU’s 28 leaders called to mull a joint response to military crisis in Crimea.

Barroso said the EU’s immediate priority was to help find a peaceful solution to the crisis that “must include a withdrawal from Russian armed forces to the areas of their permanent stationing.”

He welcomed the direct dialogue established between Moscow and Kiev and said he hoped to see both sides agree to a deployment of international observers to Crimea.

“In parallel, the international community should mobilize to help Ukraine stabilize its economic and financial situation, which will in turn also contribute to political and social peace,” he said on announcing the aid.

He said the package consisted of immediate short and medium term measures offering trade, economic, technical and financial assistance to Ukraine.

He detailed it as follows:

- EUR1.6 billion in loans under macro-financial assistance.

- EUR1.4 billion in grants, of which EUR600 million can be disbursed in the next two years.

- EUR3 billion from the European Investment Bank from 2014-2016 and a proposed trust fund in which EU budget money and bilateral money from member states can be pooled.

- Efforts with the European Bank for Reconstruction and Development, to which the EU is a majority shareholder, to liberate a further EUR5 billion.

Barroso added that the Commission would also mobilize EUR250 million to leverage EUR3.5 billion of loans from bankable investment projects.

It would also create a special donor coordination mechanism which the European Union is ready to host.