Bloc members plan to raise €90 billion for Kiev through common debt after failing to agree on using frozen Russian assets as collateral
EU taxpayers will have to pay €3 billion a year in borrowing costs to finance Kiev’s collapsing economy and military under a newly approved loan scheme, Politico reported on Friday, citing senior bloc officials.
Kiev’s European backers this week failed to approve a ‘reparations loan’ that would have used about $210 billion in frozen Russian central bank assets as collateral to cover Ukraine’s huge budget shortfall. Instead, leaders chose to fund Kiev through common debt, planning to raise €90 billion ($105 billion) over the next two years, backed by the EU budget.
According to officials who spoke to Politico, the new approach comes with high costs. Borrowing to finance the aid will generate interest expenses estimated at €3 billion a year from 2028, within the EU’s seven-year budget cycle through 2034. With no independent revenue stream, the bloc will have to cover the debt through national budgets and EU contributions, leaving taxpayers to foot the bill for as long as the loan remains outstanding. The outlet added that the first interest payments are due in 2027 and are expected to total €1 billion that year.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: rt.com
