Ukraine's defence firms get over UAH 12.5bn in subsidised loans, ministry says
Ukraine's Defence Ministry says defence-industry companies have secured more than UAH 12.5 billion in preferential loans under 211 contracts. Borrowers pay 5% a year, and the state covers the rest of the financing cost.
Ukraine's Defence Ministry says it has given defence-industry companies access to preferential loans worth more than UAH 12.5 billion. The ministry announced the figure on its Telegram channel on 14 October.
According to the ministry, 211 loan agreements have been signed in almost two years since the programme began. It says the loans give producers the financing they need to scale up output quickly.
Terms of the programme
Under the scheme, a company can borrow up to UAH 500 million. The loan term depends on its purpose:
- investment projects: up to 5 years;
- working capital: up to 3 years.
Borrowers pay 5% a year. The ministry says the state compensates the rest of the cost of the financing. It did not say what the full market rate on these loans is, or which banks issue them.
The money can be spent on expanding production capacity. It can also fund the development, manufacture, repair and modernisation of weapons, military and special equipment, and ammunition.
What the ministry did not say
The announcement is a short statement of official figures, and they could not be independently verified. The ministry did not name any borrowers. It also did not say how much of the UAH 12.5 billion has actually been disbursed, as opposed to approved or contracted.
The post gave no figure for what the interest subsidy costs the state budget. It also gave no breakdown between investment loans and working-capital loans, or between large and small producers.
Dividing the total by the number of contracts gives an average of roughly UAH 59 million per agreement. This is RealUA's own arithmetic based on the ministry's rounded figures. It suggests most loans are far below the UAH 500 million ceiling, but the actual distribution is unknown.
The announcement comes as the ministry is working on other ways to support the defence industry. Defence Minister Yevhenii Khmara recently said the ministry wants to protect defence-industry workers from mobilisation as far as possible, as RealUA reported earlier.
