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EU Commission working on proposal for joint borrowing to help finance Ukraine – sources

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© Reuters. FILE PHOTO: European Union flags fly outside the European Commission headquarters in Brussels, Belgium, March 6, 2019. REUTERS/Yves Herman

BRUSSELS (Reuters) – The European Commission is considering new joint debt issuance by the 27-nation bloc, two EU officials said, to cover Ukraine’s liquidity gap of 15 billion euros ($15.9 billion) over the next three months.

A Commission proposal is to be published on May 18, one EU official said. The new joint EU borrowing, if agreed, could be based on the EU’s SURE scheme for financing unemployment benefits during the COVID-19 pandemic, officials said.

This would mean that Ukraine would get very cheap loans from the bloc, and EU governments would need to provide guarantees that the joint borrowing would be repaid.

“It is one of the models under consideration, but nothing has been decided yet,” one senior EU official said.

The EU expects that the United States would join the effort and provide around 5 billion euros, which would leave the EU to raise some 10 billion euros through the joint borrowing, officials said.

The idea is will be discussed at the Group of Seven finance ministers meeting in Bonn on May 18-20, officials said.

EU Commission working on proposal for joint borrowing to help finance Ukraine – sources

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