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LUXEMBOURG ― Western support for Ukraine dwarfs the U.S. recovery plan for Europe after World War II, the head of a top public lender has said.
Odile Renaud-Basso, chief of the European Bank for Reconstruction and Development (EBRD), described Western support for Ukraine as “huge” despite recent criticism alleging that Kyiv’s allies haven’t done enough to support the war-ravaged country.
EU leaders are also facing pressure from Kyiv to use over €200 billion worth of Russian assets that were frozen in Europe to finance its reconstruction.
“[The EU’s financial assistance] is much bigger in real terms than any Marshall Plan after the Second World War in terms of percentage of GDP of support,” Renaud-Basso told POLITICO, while publicly announcing for the first time she intends to run for a second mandate as EBRD chief later this year.
The French official was referencing a major investment plan associated with former U.S. Secretary of State George Marshall to support the reconstruction of 16 countries, mainly in Western Europe, in the late 1940s.
Brussels and Washington have been Ukraine’s biggest financial backers during the conflict, handing out €27.5 billion and €22.9 billion, respectively, between Russia’s February 2022 invasion and the end of last year.
“The fact that they [Ukraine] received 50 percent of their budget financed by external support is huge,” Renaud-Basso said.
She noted that the EU’s expected €18 billion in 2024 funding for Ukraine represents almost a tenth of the country’s €186 billion projected GDP.
Western fatigue
Brussels and Washington have recently faced serious resistance to funding Ukraine from their national budgets.
EU leaders finally approved €50 billion in funding for Kyiv until 2027 in early February after Hungarian leader Viktor Orbán had blocked the package in a previous December meeting.
U.S. President Joe Biden, meanwhile, has had trouble passing a military aid package to Ukraine through Congress, where it is opposed by a significant share of Republicans.
Renaud-Basso dismissed criticism from some of Ukraine’s supporters that the EU’s aid package is underwhelming compared to the bloc’s seven-year €1.074 trillion budget.
EU leaders must tread a fine line between supporting Ukraine and financing domestic priorities, she said.
“Even if it doesn’t look enormous … compared to the real margin they [EU leaders] have in their budget, to finance additional measures for their people, it’s not an easy trade off,” Renaud-Basso said, adding she faced similar problems at the EBRD.
The development bank increased its capital by €4 billion in order to step up support to Ukraine without cutting back on other programs, Renaud-Basso said. The EBRD has already provided €3.8 billion to Ukraine since the war began in the form of loans, and has committed to increase support when the conflict ends.
The London-based institution axed funding to Russia and Belarus shortly after the Kremlin’s invasion of Ukraine.
The EBRD was set up in 1991 to help former Soviet countries ― including Russia ― transition into market economies, and currently covers 72 countries.
