Sweden pledges urgent loans to Ukraine

Sweden has said it would be ready to pay out emergency loans to Ukraine, with the finance minister hoping that Sweden's early-bird attitude would "put pressure" on its EU neighbours to pledge cash.

Sweden pledges urgent loans to Ukraine
Demonstrators in Kiev held a EU flag on March 2nd. File: TT

The Swedish government and its Nordic and Baltic neighbours are ready to lend the new Ukrainian government money, Finance Minister Anders Borg said on Wednesday.

"There is no point in only sending money. There must also be possibilities to reform the politics," Borg said.

The Swedish government said that the IMF's review of the Ukrainian economy would determine exact loan conditions and interest rates. EU heads of government will also discuss such details next week. Ukraine has said it needs $30 to 35 billion in the next two years to reform and steady its economy. 

"There's quite a considerable funding gap that needs to be filled," Borg said as he encouraged more EU nations to open their purses.

Sweden's stance will be put forward by Prime Minister Fredrik Reinfeldt at a meeting for EU government chiefs next week.

"We want to first increase the pressure on other countries," Borg noted. "When Fredrik Reinfeldt at the EU meeting can underline that Sweden is ready then that puts pressure on the other countries to also help with bilateral programmes."

Borg can rely at home on the support of the main opposition party the Social Democrats, with whom he consulted before making the bilateral loan announcement, said Marie Grandlund, who sits on the parliamentary committee for EU affairs.

"It's important to show that we support Ukraine at the moment and it's important to send a message to Russia," Granlund said of the finance minister's plans. "So we are positive, but of course we have to look at what it entails and the shape it will take."

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