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A Lifeline for Developing Countries: The Untapped Potential of EU Macro-Financial Assistance

The European Union (EU)’s arsenal of development finance instruments comprises grants, budget support, blends of grants and loans, guarantees, and trust funds. But little attention has been paid to its macro-financial assistance (MFA) tool. Since the 1990s, it has been deployed to help countries in the EU neighbourhood that face balance-of-payment crises. Recently, a special MFA+ instrument of EUR18 billion was deployed in the form of highly concessional loans with long maturities to provide immediate finance assistance to Ukraine. ....

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