Salem Radio Network News Saturday, May 28, 2022

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EU Commission working on proposal for joint borrowing to help finance Ukraine – sources

BRUSSELS (Reuters) -The European Commission is considering new joint debt issuance by the 27-nation bloc, two EU officials said, to cover Ukraine’s liquidity gap of 15 billion euros ($15.9 billion) over the next three months, though Germany is sceptical to the idea.

A Commission proposal is to be published on May 18, one EU official said. The new joint EU borrowing, if agreed, could be based on the EU’s SURE scheme for financing unemployment benefits during the COVID-19 pandemic, officials said.

This would mean that Ukraine would get very cheap loans from the bloc, and EU governments would need to provide guarantees that the joint borrowing would be repaid.

“It is one of the models under consideration, but nothing has been decided yet,” one senior EU official said.

The EU expects that the United States would join the effort and provide around 5 billion euros, which would leave the EU to raise some 10 billion euros through the joint borrowing, officials said.

The idea is to be discussed at the Group of Seven finance ministers meeting in Bonn on May 18-20, officials said.

But a German government official expressed scepticism towards any such proposal.

“We are looking for a G7 answer, but without a joint borrowing in the EU. Recent talks have been promising,” the official said.

(Additional reporting by Christain Kraemer in Berlin; Reporting by Jan StrupczewskiEditing by Raissa Kasolowsky)

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