Canada offers Ukraine $120M loan as it confronts threat of Russian invasion

Canada today offered Ukraine a $120 million dollar loan to help the eastern European nation face down what Prime Minister Justin Trudeau called an “aggressive” attempt by Russia to destabilize it.

The prime minister also hinted at more military assistance for Ukraine, while insisting again that Moscow “de-escalate” and refrain from further invading and occupying Ukrainian territory.

The federal government said the loan announced today is meant to go toward “economic resilience and governance reforms.” The terms of the loan are to be negotiated with the government of President Volodomyr Zelensky in Kyiv.

The loan is among the top requests Ukraine has issued to Canada and is intended to ease “the aggressive economic destabilization that is perpetrated by Russia,” Trudeau told a virtual press conference, called to announce a domestic affordable housing initiative.

“One of the things the Ukrainian government has been clear [about] is having additional resources to shore up their economy would be extremely important in reassuring the Ukrainian people and standing strong against Russian destabilization,” he said.

Canada has been one of Ukraine’s biggest bilateral donors since 2014, having spent $245 million on the country’s constitutional, judicial and security reforms, among other things. That figure does not include what both Liberal and Conservative governments have spent on military training and technical assistance missions in Ukraine over the past seven years.

The Canadian loan offer is part of a flood of western financial assistance that has flowed into Ukraine over the past several months.

In December, the World Bank approved a $428 million (300 million euro) loan to help Ukraine offset the economic shocks brought on by COVID-19. International financial institutions also kicked in a $285 million (200 million euro) loan to help expand transportation infrastructure across Ukraine.

Separately, the International Monetary Fund (IMF) last fall approved a $700 million loan to help the country implement further reforms.

Trudeau said Canada is prepared to send military assistance but would not state precisely what he’s prepared to offer. He also refused to state unequivocally that Canadian troops would not be drawn into any conflict between Ukraine and Russia.

“I’m not going to engage in hypotheticals,” he said in response to a question. “Canada has been and will continue to be a friend and ally of Ukraine, and we will continue to be there to support them and ensure that the Ukrainian people get to determine their future — not Vladimir Putin.”

CBC