Parliament ratifies the Contribution Agreement between Bulgaria and the EIB regarding the “EU for Ukraine” Fund

SOFIA – The Bulgarian Parliament adopted at first and second reading in one sitting the Draft Law on the Ratification of the Contribution Agreement between the Republic of Bulgaria and the European Investment Bank (EIB) regarding the “EU for Ukraine” Fund.

Finally, at second reading, the agreement was supported by 108 members of parliament, and 57 were “against”. There were no abstentions.

Bulgaria’s participation in the “EU for Ukraine” Fund with a contribution in the form of a guarantee in the amount of 10 million euros was approved by the Council of Ministers on 11 October 2023, as stated in the report of the budget committee. The issuance of the state guarantee in connection with Bulgaria’s participation in the Fund through the conclusion of the two agreements with the EIB is provided for in Article 73, item 2 of the Law on the State Budget of the Republic of Bulgaria for 2025.

The Fund is part of the EIB’s “EU for Ukraine” initiative and aims to enable the member states of the European Union, the European Commission and other countries and donors to support the reconstruction of Ukraine through their contributions. The contribution is voluntary and may be in the form of a cash payment, a guarantee, or a combination of both.

The funds are used to guarantee the EIB’s operations with its own resources in Ukraine, as well as to provide investment grants and interest subsidies, according to the report of the budget committee. Within the framework of the Fund, both public and private sector projects are financed, with a main focus on municipal infrastructure.

The donors’ contributions are regulated by a Contribution Agreement concluded between the respective country and the EIB. It determines the amount, type (cash contribution or guarantee), eligible operations, etc. In connection with contributions in the form of a guarantee, a Guarantee Agreement is concluded together with the Contribution Agreements. When a guarantee is activated, all losses on the EIB’s operations are covered collectively by all participating guarantor states, in proportion to their share in the Fund.

So far, contribution agreements have been signed by 16 EU countries – Belgium, Italy, Cyprus, Denmark, Estonia, France, Latvia, Lithuania, Luxembourg, the Netherlands, Finland, Croatia, Spain, Poland, Slovakia and Ireland, four of which have signed guarantee agreements. The total amount of everyone’s participation is 410.3 million euros.

At the end of last week, EU leaders reached an agreement to grant an interest-free loan to Ukraine in the amount of 90 billion euros, instead of using frozen Russian assets.

“Today we approved a decision to provide 90 billion euros to Ukraine,” said the President of the European Council Antonio Costa at a press conference after hours-long negotiations between European leaders in Brussels. “As an urgent matter, we will provide a loan guaranteed by the EU budget,” Costa noted.

The loan for Ukraine will be taken out only by those EU countries that wish to participate, clarified the President of the European Commission Ursula von der Leyen at a press conference after the end of the last meeting of the year of the European leaders in Brussels. She stated that the 90 billion euro loan will be raised from international markets under the EU’s enhanced cooperation procedure, in which the participating states are those that have expressed a wish, with the possibility for the others to join if and when they wish. Our clear goal is to achieve a just and lasting peace in Ukraine, said von der Leyen. (19 December)