Cooperation within the framework of the ratified agreement between Ukraine and Denmark on the Danida Business Finance program

Verkhovna Rada has ratified a framework agreement between the governments of Ukraine and Denmark regarding general conditions and procedures, organizational arrangements and financial conditions for the implementation of the Danida Business Finance program in Ukraine.

Danida Business Finance (DBF) is a Danish development cooperation program that provides interest-free loans and/or financial aid to finance sustainable infrastructure projects in developing countries related to technology transfer and know-how from Danish companies. Projects must comply with the development strategies and sectoral plans of the beneficiary country, be aimed at ensuring sustainable development and employment, first of all, investment in municipal infrastructure.

As part of the implementation of the program, financing will be received by government agencies, utilities and other business entities working in the following areas:

  • heat supply;
  • wind power;
  • improving the network and increasing its throughput capacity;
  • supply of drinking water;
  • water treatment facilities;
  • technologies for providing free water supply.

 

With DBF assistance, loans must meet the following conditions:

– loans are interest-free;

– maturity – up to 10 years;

– loan currency – euro or USD;

– can cover up to 100% of the project cost.

 

Financing will be provided by a commercial bank or financial institution with a representative office in Denmark loans to the government of Ukraine or Ukrainian business entities under state guarantees.

Projects can be attracted for financing, where the approximate amount of a commercial contract for one project is, but is not limited to, 100 million euros. Individual projects with a value of less than 13.5 million euros are not eligible for Danida Business Finance funding, unless otherwise agreed.

The full text of the Framework Agreement can be found at the link: https://zakon.rada.gov.ua/laws/show/208_002-19

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