Germany will provide Ukraine with a grant worth 40.5 million euro ($47.4 million) to support small and medium-sized Ukrainian businesses, Ukraine’s Finance Ministry announced on July 11.

The agreement, announced at the tail-end of the Ukraine Recovery Conference in Rome as a means to strengthen Kyiv’s country’s economic development, will be provided through Germany’s state development bank KfW, according to the Finance Ministry. The funding will be distributed through Ukraine’s Entrepreneurship Development Fund (EDF).

The combined loan and grants funding for businesses, distributed through Ukrainian banks, will primarily serve businesses in “de-occupied and war-affected territories,” with the average distribution totaling 250,000 euros.

The EDF will also provide banks with long-term liquidity to be able to fund small and medium-sized businesses with loans with favorable repayment terms, the ministry said.

The announcement comes as Kyiv secured other key financial commitments from Western allies at the Ukraine Recovery Conference, including a Dutch pledge for $350 million to support Ukraine’s reconstruction and economic recovery through 2026 and the World Bank’s commitment for $200 million over the next five years to prepare Ukrainian projects for large-scale reconstruction.

In addition to supporting Ukraine’s economic development, President Volodymyr Zelensky said during a press conference in Rome on July 10 that Germany is also ready to purchase two of three Patriot air defense systems, amid an increase in Russian attacks.

German Chancellor Friedrich Merz, who met Zelensky on the sidelines of the conference, also suggested on July 10 that Russian assets frozen by the West should not be released until Moscow pays back at least 500 billion euros (over $580 billion) in compensation to Ukraine.

Read also: Russia must pay at least 500 billion euros in compensation to Ukraine, Germany’s Merz says

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