The European commission agreed on an economic and financial aid package for the embattled Ukraine on Wednesday that, if approved, would fast-track the elimination and reduction of duties on Ukraine’s exports of such industrial products as apparel, textiles and footwear to the European Union.
The EC’s offer comes at a tense time between the West and Russia, which increased its military presence in Crimea, a Ukrainian peninsula, after the ouster of Ukrainian President Viktor Yanukovych and raised the stakes internationally as the West scrambled to offer aid to Ukraine and threatened sanctions against what some are calling Russia’s aggression. The U.S. offered an aid package of $1 billion in loan guarantees on Tuesday.
The EC’s package would provide 11 billion euros, or about $15 billion, in financial aid to Ukraine in the form of loans, grants and trade benefits over the next two years, according to EC President José Manuel Barroso, who unveiled the package at a news conference in Brussels.
“The most immediate priority for the EU is to contribute to a peaceful solution to the current crisis, in full respect of international law,” said Barroso. “In parallel, the international community should mobilize to help Ukraine stabilize its economic and financial situation. The European Commission is proposing today a package designed to assist a committed, inclusive and reforms-oriented government in rebuilding a stable and prosperous future for Ukraine.”
Barroso said the broad package would be coordinated with the European Bank for Reconstruction and Development and the European Investment Bank. In addition, some of it would be contingent on Ukraine signing an International Monetary Fund loan package. On the trade front, Ukraine exported 474 million euros, or $651 million, worth of apparel, textiles, footwear and accessories to the EU in 2012, based on the latest figures available.
Under the proposed aid package, which will be presented to the EU heads of state and government at a meeting in Brussels on Thursday, the EC said it was ready to offer “the early application” of the duty reductions and tariff rate quotas embedded in the EU-Ukraine Deep and Comprehensive Free Trade Area deal, which has not yet been signed or implemented.