The G7, a group of rich countries, has reached an agreement on 18 billion euros in financial aid for Ukraine, German finance minister Christian Lindner told news agency Friday. Bloomberg† The day before, the European Commission announced that it will lend the war-torn country 9 billion euros.
The money from both the G7 and the European Commission should ensure that Ukraine can continue to pay its bills in the short term and start rebuilding the country. According to the International Monetary Fund (IMF), the country needs 14.3 billion euros to meet all its obligations, but that does not include the costs of destroyed infrastructure.
The package includes 7.5 billion dollars (7.3 billion euros) in aid from the United States and the European Union also contributes to the aid. It is unclear whether this concerns the loan of 9 billion euros, or whether the money will be added on top of that.
According to Ukrainian Prime Minister Volodymyr Zelensky, reconstruction has cost about $600 billion so far. Economists expect the country’s economy to shrink by up to 50 percent this year. “We are keeping a close eye on things, but I think we have made a good decision at the moment that will allow Ukraine to pay its debts,” Lindner said on Friday.
The G7 consists of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. The European Union also often joins group meetings.