2002/639/EC: Council Decision of 12 July 2002 providing supplementary macro-financial assistance to Ukraine

Council Decision
of 12 July 2002
providing supplementary macro-financial assistance to Ukraine
(2002/639/EC)
THE COUNCIL OF THE EUROPEAN UNION
,
Having regard to the Treaty establishing the European Community, and in particular Article 308 thereof,
Having regard to the proposal from the Commission(1),
Having regard to the opinion of the European Parliament(2),
Whereas:
(1) The Commission consulted the Economic and Financial Committee before submitting its proposal.
(2) Ukraine is undertaking fundamental political and economic reforms and is making substantial efforts to implement a market economy model.
(3) Ukraine, of the one part, and the European Community and its Member States, of the other part, have concluded a Partnership and Cooperation Agreement which will help the development of a full cooperation relationship.
(4) The Chernobyl nuclear power plant was closed down in December 2000, in line with what was agreed by the Ukrainian authorities, the Group of Seven countries and the European Union in a Memorandum of Understanding signed on 21 December 1995.
(5) In September 1998, the International Monetary Fund (IMF) approved an "extended fund facility" (EFF) for Ukraine of approximately USD 2,3 billion, later increased to approximately USD 2,6 billion, in support of an economic programme for the period July 1998 to June 2001. In December 2000, the IMF extended the duration of this financial arrangement to August 2002. Since 1998 the World Bank has provided substantial support for Ukraine's reform efforts, including through the approval in September 1998 of a USD 300 million Financial Sector Adjustment Loan (FSAL). The World Bank is expected to continue providing substantial financial assistance to Ukraine in the coming years, including through the approval of a number of adjustment loans.
(6) In July 2001 the Members of the Paris Club agreed on a rescheduling of Ukraine's debts.
(7) By Decisions 94/940/EC(3), 95/442/EC(4) and 98/592/EC(5) the Council approved macro-financial assistance for Ukraine of up to a total amount of EUR 435 million to support previous macroeconomic programmes.
(8) The circumstances that justified the provision of macro-financial assistance to Ukraine pursuant to Decision 98/592/EC have changed and this Decision, including any undisbursed amounts of assistance, should now be replaced.
(9) However, additional official support from the Community is required in the context of the present programme to support the balance of payments, consolidate the reserve position and facilitate the necessary structural adjustment of the country.
(10) The Community loan should be managed by the Commission.
(11) The Treaty does not provide, for the adoption of this Decision, powers other than those of Article 308,