The European Commission has proposed new macro-financial assistance (MFA) to Ukraine of up to €1 billion in medium-term loans.

The new package is expected to be approved by the EU's Council of Ministers in the coming weeks, European Commission said in a statement.This is a part of the package of support to Ukraine endorsed by the European Council on 6 March.

"It is in the essential interest of Ukraine and of the EU to maintain peace and political and financial stability in our continent. This financial aid will help in stabilising the worsening financial situation in Ukraine and therefore will be one vital part of achieving a solution to the crisis," said Olli Rehn, Vice-President of the European Commission.

The proposed EU MFA is designed to help Ukraine cover part of its urgent external financing needs in the context of the stabilisation and reform programme currently under preparation with the help of the International Monetary Fund (IMF). The proposed assistance is aimed at reducing the economy’s short-term balance of payments and fiscal vulnerabilities.