EU and Ukraine sign €1.8bn financial assistance agreement

The European Union and Ukraine signed an agreement on Friday (22 May) for an additional €1.8bn (£1.29bn, $2.01bn) in EU financing to Ukraine.

Ukrainian President Petro Poroshenko oversaw the signing which took place on the sidelines of an Eastern Partnership summit between EU leaders and six ex-Soviet states in Riga, Latvia.

European Euro and Social Dialogue Commissioner Valdis Dombrovskis, Ukrainian Finance Minister Natalie Jaresko and Governor of the National Bank of Ukraine Valeria Gontareva signed the agreement, which is the third macro-financial assistance programme the EU has given to Ukraine.

"The macro-financial assistance programme follows already two other macro-financial assistance programmes amounting to a total of €1.61bn, and it's actually the largest macro-financial assistance programme which has ever been committed to a non-EU country," Dombrovskis told reporters.

The agreement also includes a policy programme drawing from the reform agenda of the Ukrainian authorities. Jaresko said anti-corruption is one of the three principal areas of reform efforts, along with stabilisation of Ukraine's financial and monetary system, as well as re-building the country's business environment.

"Every single loan agreement that we enter into, whether it's with the IMF [International Monetary Fund], the World Bank, or in this agreement, there are reforms that are part of this [anti-corruption] effort. To date, we've focused on prosecution, we've focused on policy in the anti-corruption area, and we've focused on so-called de-oligarchisation, or levelling the playing field.

"Those three areas have begun in reality in Ukraine, and continue and the paces continues to accelerate and are part of every set of reforms that we envisage," Jaresko said.

The agreement must now be ratified by the Ukrainian Parliament. The EU said it envisaged to disburse the package in three equal tranches of €600m.