According to an internal study conducted by the secretariat of the EU Council, Ukraine could receive billions of euros in subsidies from the EU upon its accession to the bloc. The study reveals that Kiev would be entitled to €96.5 billion ($101 billion) in payments from the EU’s Common Agricultural Policy and €61 billion ($64 billion) in subsidies from the cohesion funds dedicated to improving infrastructure in poorer member states. This means that the EU may have to allocate around €186 billion ($195 billion) for Ukraine over the seven years following its entry.
However, this substantial influx of funds for Ukraine would have significant implications for the EU’s agricultural subsidy regime. With 41.1 million hectares of utilized agricultural area, Ukraine would become the largest recipient of subsidies in the bloc. As a result, existing recipients could face a 20.3% cut in payments per 1 hectare of farmland. Experts argue that these changes may be too costly unless adjustments are made to the EU budget.
Mujtaba Rahman, the managing director for Europe at the Eurasia Group, commented on the matter, stating that “these numbers aren’t going to work for anyone.” He emphasized the need for a comprehensive reform of the EU budget and its major policies to accommodate Ukraine’s membership or suggested that an innovative approach could be taken outside of the existing EU budget structures.
The study conducted by the EU Council also analyzed the potential entry of nine additional members, including Moldova, Georgia, and six western Balkan states, alongside Ukraine. The analysis estimated that the cost of adding all these countries to the EU’s existing budget would amount to approximately €256.8 billion ($269 billion). It warned of a drastic redistribution of funds within the union and highlighted that countries like the Czech Republic, Estonia, Lithuania, Slovenia, Cyprus, and Malta would no longer be eligible for cohesion funding if new members joined.
The document stated that all member states would have to pay more to and receive less from the EU budget, with current net receivers becoming net contributors. While acknowledging that opportunities may outweigh the costs/risks for several policies, the enlargement would pose significant challenges for the EU budget that need to be addressed promptly.
Reports suggest that the EU is prepared to begin membership negotiations with Ukraine, with an announcement expected by the end of the year. Charles Michel, the head of the European Council, has previously stated that Ukraine could become a member of the bloc by 2030.
In conclusion, Ukraine stands to receive substantial financial support from the EU upon its accession to the bloc. However, these subsidies would require significant adjustments to the EU budget and policies, potentially impacting existing recipients. The EU Council’s study also highlights the challenges associated with the potential entry of multiple countries and the need for careful consideration of the financial implications. Nonetheless, it appears that the EU is moving towards negotiations with Ukraine, raising the possibility of its membership by 2030.