KIEV (Sputnik) — Ukrainian Deputy Prime Minister Hennadii Zubko said that the funds would be used for restoration of eastern Ukraine, including modernization of infrastructure and construction of housing.
“A ceremony of signing a Memorandum of understanding between the Government of Ukraine and the Government of the Federal Republic of Germany on a non-binding financial loan and a Framework agreement between the Government of Ukraine and KFW Bankengruppe on individual loans worth up to EUR 500 million took place in Berlin on Wednesday, April 1,” the statement read.
Ukraine's economy suffered a dramatic downturn amid a military confrontation in eastern Ukraine between Kiev forces and local independence supporters, who refused to recognize the government that had come to power in Kiev after a coup.
Kiev authorities are trying to rescue the country’s war-hit, deteriorating economy with international loans.
In spring 2014, the International Monetary Fund (IMF) promised Kiev $17 billion in bailout loans, to be paid over the course of two years. In addition, several Western countries allocated funds to Ukraine to help the country rebuild its economy and enact necessary structural reforms.