Bulgaria Ratifies Contribution Agreement with European Investment Bank to Support Ukraine

Strategic Insights -

The Bulgarian parliament's Budget and Finance Committee has approved a bill ratifying the Contribution Agreement between Bulgaria and the European Investment Bank (EIB) concerning the EU for Ukraine Fund. This fund serves as a temporary bridging mechanism, complementing existing financial instruments, to support Ukraine's recovery. The agreement aims to enable EU Member States, the European Commission, and other countries and donors to contribute to Ukraine's recovery through various forms of contributions, including cash, non-cash (guarantees), or a combination of both.

Key Takeaways:

  • The EU for Ukraine Fund is a temporary bridging mechanism that complements existing financial instruments of the European Union and other global initiatives in support of Ukraine.
  • The fund is designed to enable EU Member States, the European Commission, and other countries and donors to contribute to Ukraine's recovery.
  • Contributions to the fund are voluntary and may be made in the form of cash, non-cash (guarantees), or a combination of both.
  • The fund comprises two sub-funds: one for cash contributions and another for guarantee-based contributions.
  • 16 EU Member States have signed contribution agreements to date, including Belgium, Italy, Cyprus, Denmark, Estonia, France, Latvia, Lithuania, Luxembourg, the Netherlands, Finland, Croatia, Spain, Poland, Slovakia, and Ireland.
  • The total contributions from these member states amount to EUR 410.3 million.
  • Bulgaria will contribute to the fund by providing a financial guarantee of EUR 10 million.
  • The proposed bill does not directly affect the state budget, but the State Budget Act of the Republic of Bulgaria for 2025 provides for the issuance of a state guarantee related to Bulgaria's participation in the EU for Ukraine Fund.

Statistics:

  • Total contributions from EU Member States: EUR 410.3 million.
  • Contributions from individual EU Member States:

* Belgium: EUR 6 million

* Italy: EUR 100 million

* Cyprus: EUR 1 million

* Denmark: EUR 10 million

* Estonia: EUR 10 million

* France: EUR 100 million

* Latvia: EUR 7 million

* Lithuania: EUR 10 million

* Luxembourg: EUR 1.3 million

* Netherlands: EUR 52 million

* Finland: EUR 5 million

* Croatia: EUR 1 million

* Spain: EUR 70 million

* Poland: EUR 25 million

* Slovakia: EUR 5 million

* Ireland: EUR 7 million

  • Bulgaria's contribution: EUR 10 million (financial guarantee).

Sources:

  • The parliamentary Budget and Finance Committee
  • The European Investment Bank (EIB)
  • The explanatory memorandum submitted by the Council of Ministers.