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The European Union's executive agency proposed for the first time up to 9 billion euros ($9.5 billion) in assistance to help Ukraine pay its bills through the rest of 2022, matching U.S. plans to provide $8.5 billion in immediate short-term aid, European Commission President Ursula von der Leyen said on Wednesday.

The money, which will need to be signed off by EU member states, comes on top of a EUR1.2 billion loan this spring, as Europe and its western allies seek to help President Volodymyr Zelensky pay debts and keep providing basic services for Ukrainians amid the Russian invasion.

The International Monetary Fund has estimated Ukraine needs around $5 billion in assistance to keep the country running amid a massive economic slump caused by Russia's invasion. The IMF disbursed $1.4 billion of emergency financing on March 9 to Ukraine.

Ukraine's government expects the economy to contract by around 45% this year.

The EU money will come through a so-called macro-financial assistance package, which is usually a long-term, low-interest loan. It isn't yet clear if any of the money will come as a grant.

Ms. von der Leyen said the EU will start work on a long-term reconstruction plan for Ukraine, which international institutions believe could cost at least $500 billion.

Comment: The EU doesn't even know how much of Ukraine will be handed over to them to 'reconstruct' (once the Russians have finished deNazifying the place) so that announcement may at least in part be intended to fool people into thinking the US proxy war is going better than it really is, in addition to providing room for the EU to allocate even more funding to essentially continue weaponising Ukraine.

She said the EU will set up a reconstruction platform jointly with the Ukrainian government to begin making plans for a future reconstruction.

EU officials have said the bloc could raise some money by having the Commission issue bonds in the financial markets, as it did to fund its coronavirus recovery fund.

The EU is looking to partner with the U.S. and other western partners on a reconstruction fund. Ms. von der Leyen said the money would be tied to deep economic and political reforms in Ukraine.

"These investments will help Ukraine to emerge stronger and more resilient from the devastated caused by Putin's soldiers," she said.