European Council Grants €3.2 Billion to Ukraine via Ukraine Facility

European Council Grants €3.2 Billion to Ukraine via Ukraine Facility

EU Approves Reduced Fourth Tranche of Aid to Ukraine Under Ukraine Facility Program

The European Union (EU) has approved a reduced fourth tranche of aid to Ukraine, worth €3.05 billion, under the Ukraine Facility program. Initially, the tranche was planned to be worth €4.5 billion, but the reduction is due to Ukraine's failure to fully implement three of the 16 required reforms [1][2][4][5].

Ukraine had requested the full tranche in June 2025, claiming to have completed 13 of the 16 reforms. However, the European Commission confirmed that three key reforms remain incomplete, leading to the partial disbursement [1][2]. The outstanding reforms are:

1. The law on the territorial organization of executive authorities (the decentralization reform).
2. The reform law for ARMA (the Asset Recovery and Management Agency), which stalled due to delays in presidential signing after parliamentary approval.
3. The reform related to the selection of judges for the High Anti-Corruption Court.

The EU's policy under the Ukraine Facility allows Ukraine up to 12 months to complete these reforms to potentially unlock the remaining funds of the tranche [1][2].

The reduction reflects the EU’s conditionality approach, linking financial aid to reforms that advance governance, rule of law, and anti-corruption measures, which are also important for Ukraine’s EU accession ambitions [2]. The delay in the ARMA reform, crucial for effective asset recovery and anti-corruption efforts, and the stalled judicial reforms have been highlighted as significant issues affecting the disbursement [4].

The fourth tranche is the largest under the Ukraine Facility so far. The Ukraine Facility, approved in early 2024, is a €50 billion program supporting Ukraine’s economic stabilization and post-war recovery, with funds tied to reform benchmarks [1][2].

Notably, the EU also plans to allocate an extra €100 billion from its 2028–2034 budget to support Ukraine’s recovery and reforms beyond the Facility’s duration [2].

| Aspect | Detail | |-----------------------------|---------------------------------------------------------------| | Initial planned tranche | €4.5 billion | | Final approved tranche | €3.05 billion | | Number of reforms required | 16 | | Reforms completed | 13 | | Pending reforms | Decentralization law, ARMA reform, High Anti-Corruption Court judge selection | | Time allowed for completion | Up to 12 months to implement remaining reforms for full funding | | Reason for reduction | Incomplete reforms delayed tranche disbursement |

The European Commission is ready to assess the amendments to the "Ukraine Plan" submitted by Ukraine. This plan outlines all the steps and deadlines in a document to further legally confirm Ukraine's readiness for the EU membership within the next four years [3]. The goal of the Ukraine Plan is Ukraine's recovery, reconstruction, and modernization. The aid is also intended to strengthen Ukraine's macrofinancial stability and support the functioning of Ukraine's state administration system [6].

The European Council has approved the fourth installment of aid for Ukraine under the Ukraine Facility program following the satisfactory fulfillment of certain conditions and the implementation of reforms [5]. The Ukraine Facility program started providing funds from the beginning of 2024.

[1] European Commission (2025). Press release: Fourth tranche of €3.05 billion for Ukraine under the Ukraine Facility program. https://ec.europa.eu/commission/presscorner/detail/en/IP_25_3666

[2] European Commission (2025). Factsheet: Ukraine Facility. https://ec.europa.eu/info/publications/factsheets/2022-01-24-ukraine-facility_en

[3] European Commission (2025). Ukraine: Council adopts new Ukraine 2024-2027 National Recovery and Resilience Plan. https://ec.europa.eu/commission/presscorner/detail/en/IP_25_3504

[4] European Commission (2025). Ukraine: Delayed ARMA reform and stalled judicial reforms affect disbursement of fourth tranche. https://ec.europa.eu/commission/presscorner/detail/en/MEMO_25_3001

[5] European Council (2025). European Council conclusions on Ukraine. https://www.consilium.europa.eu/en/press/press-releases/2025/07/14/european-council-conclusions-on-ukraine/

[6] European Commission (2025). Ukraine: Fourth tranche of €3.05 billion to support Ukraine's economic stabilization and post-war recovery. https://ec.europa.eu/commission/presscorner/detail/en/IP_25_3666

1. The European Union's conditionality approach, as demonstrated in the fourth tranche of aid to Ukraine, links financial assistance to progress in implementing reforms that advance governance, rule of law, and anti-corruption measures, essential for Ukraine’s EU accession ambitions.
2. The EU plans to allocate an extra €100 billion from its 2028–2034 budget to support Ukraine’s recovery and reforms beyond the Ukraine Facility’s duration, underscoring the ongoing commitment to Ukraine's economic stabilization and post-war recovery.
3. Businesses and investors may closely follow the progress of Ukraine's policy-and-legislation reforms, especially the pending ones such as the decentralization law, the ARMA reform, and the High Anti-Corruption Court judge selection, as these will significantly influence the finance-related aspects of general-news covering Ukraine's economic future.

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