Ukraine Gets $39 Billion Funding Boost

The European Union has committed to lending Ukraine up to €35 billion (approximately $39 billion) as part of a coordinated effort with the Group of Seven (G7) industrialized nations.

This financial package aims to support Ukraine in rebuilding its economy and war-damaged power grid. In June, G7 leaders agreed to create a $50 billion loan to assist Ukraine in its ongoing war effort.

European Commission President Ursula von der Leyen emphasized the importance of holding Russia accountable, stating, “We should make Russia pay for the destruction it caused.”

Since the onset of the war in February 2022, the EU has provided over €118 billion ($132 billion) in military and economic support to Ukraine.

Von der Leyen noted, “Russia’s relentless attacks mean further support is necessary.” She assured that the new loans would directly bolster Ukraine’s national budget, enhancing its macro-financial stability. “You will decide how best to use the funds,” she added, highlighting the flexibility granted to Ukrainian leaders in managing these resources.

The funding will be underwritten by profits from nearly $300 billion in Russian assets frozen after its invasion. The majority of these assets are in EU nations, particularly Belgium. Von der Leyen expressed confidence in the rapid delivery of this loan, hoping other G7 nations would follow suit in offering support.

Ukrainian President Volodymyr Zelensky outlined his priorities, including rebuilding the energy network, constructing more bomb shelters, improving educational facilities, and increasing military supplies. With winter approaching, von der Leyen’s visit focused on restoring Ukraine’s electricity grid and boosting heating capacity.

The war has severely damaged around half Ukraine’s energy infrastructure, leading to rolling blackouts that leave eastern regions in darkness for hours. Von der Leyen said it was the equivalent of all of Latvia, Lithuania and Estonia losing electricity, underscoring the urgency as the heating season looms.

“Heating season starts in two weeks, and Russia’s relentless attacks aim to inflict maximum damage,” she warned. The EU’s goal is to help Ukraine decentralize its power grid, reducing reliance on large power stations that are easy targets for Russian missile strikes. Following a major attack last month, which saw over 260 missiles targeting energy infrastructure, the need for immediate assistance has grown.

In response, the EU has dispatched over 10,000 generators and transformers, along with mobile gas turbines. These resources are more difficult to hit and easier to repair. Ukraine is expected to require around 17 gigawatts of power this winter, with the EU aiming to supply 25% of that need.

This article includes reporting from The Associated Press