On 20 September, the European Union announced a significant loan package for Ukraine, pledging up to 35 billion euros ($39 billion) to help rebuild the country’s economy and war-damaged power grid. This loan is part of a larger $50 billion aid package organized by the Group of Seven (G7) major industrial nations.

AP reports that European Commission President Ursula von der Leyen, speaking at a news conference in Kyiv alongside Ukrainian President Volodymyr Zelenskyy, stated,

“We should make Russia pay for the destruction it caused,” she said, emphasizing that the loan would flow directly into Ukraine’s national budget, providing “significant and much-needed fiscal space” and allowing Ukraine to decide how best to use the funds.

The loan package is designed to be underwritten by windfall profits earned on nearly $300 billion in Russian assets frozen due to the invasion of Ukraine. Von der Leyen expressed confidence in the EU’s ability to deliver the loan to Ukraine quickly and hoped that other G7 countries would follow suit.

President Zelenskyy outlined his priorities for the funds, including rebuilding Ukraine’s energy network, constructing more bomb shelters, improving schools, and purchasing weapons and ammunition.

Von der Leyen highlighted the urgent need for support, noting that around half of Ukraine’s energy infrastructure has been destroyed during the war. The EU aims to help Ukraine decentralize its power grid and become less reliant on large power stations that are easier targets for Russian forces.

The European Commission President also announced an additional 160 million euros ($180 million) to help fortify Ukraine’s energy network, with 100 million euros ($112 million) coming from windfall profits earned on frozen Russian assets.

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• EU allocates part of the proceeds from frozen Russian assets for Ukraine’s humanitarian needs
• “Now we make Russia pay”: EU to transfer first $ 1.6 bn in frozen Russian assets to Ukraine
• Sky News: EU Commission president says Ukraine should be part of discussions on EU defense strategy
• Frozen Russian asset proceeds to supply Ukraine with ammo via Czech initiative