ON BEHALF OF THE GERMAN GOVERNMENT, KFW PROVIDES AN ADDITIONAL GRANT OF € 17 MILLION FOR THE IMPLEMENTATION OF THE PROJECT "HOUSING FOR INTERNALLY DISPLACED PERSONS"
On 7 December 2023, the Government of Ukraine, represented by the Ministry of Reintegration of the Temporarily Occupied Territories of Ukraine, the State Fund for Youth Housing and KfW signed Additional Agreement No. 1 to the Grant and Project Agreement of 28 December 2020, which increased funding by EUR 17 million. The additional grant funds will provide access to concessional housing loans for internally displaced persons in Ukraine. In particular, the grant will be used to issue about 400 new concessional housing loans in 2024.
"We are pleased to continue our cooperation with Ukraine in the area of concessional housing loans for Ukrainian internally displaced persons. The first part of this project, totalling €25.5 million, was successfully implemented during 2021-2022. Together with our Ukrainian partners, we quickly saw that the project has generated significant interest. That is why today we have announced additional support of €17 million. This grant is part of the German-Ukrainian development cooperation, which in 2023 alone will amount to more than €600 million," said Tim Prange, Permanent Deputy Ambassador Extraordinary and Plenipotentiary of Germany to Ukraine.
"The main thing for the Ukrainian authorities is people, protection of their humanitarian and other rights during the armed aggression of the Russian Federation. Already at the first stage of the project, we were convinced that providing IDPs with housing is a relevant and socially sensitive issue. The project "Housing for Internally Displaced Persons" has received high interest among Ukrainians who have become displaced. It provides for the provision of preferential loans for the purchase of housing on affordable terms. The project is being implemented without the involvement of the state budget of Ukraine, i.e. it is fully funded by a grant from the German government. It is very important that cooperation within this project will continue, and I hope not only next year. I am grateful to our German partners for this important decision for Ukrainians," said Iryna Vereshchuk, Vice Prime Minister of Ukraine, Minister for Reintegration of the Temporarily Occupied Territories of Ukraine.
"As a result of the war, many Ukrainian citizens were forced to leave their homes and become internally displaced. For most of them, housing is the most important issue, so we are ready to support Ukraine and its people with additional grant funds provided by the German Government. Supporting Ukrainians in time of war is an absolute priority for KfW, and we will continue to stand by Ukraine and its citizens," said Lorenz Gessner, Director of KfW Ukraine.
"The decision of the German side to continue cooperation on the IDPs' Housing project is a confirmation of the trust in all partners of this programme, the result of a high assessment of the professional and transparent implementation of the first stage of the programme by the State Agency for Youth and Sports. We will continue to ensure the impartial and high-quality implementation of the programme. We are grateful to the German Government and KfW Bank for their timely and powerful support of one of the basic needs of our citizens - the need for housing," said Mykola Marchuk, Chairman of the Board of the State Agency for Youth and Housing.
Reference materials.
History of the Housing for Internally Displaced Persons project.
On 2 December 2020, the Ukrainian Parliament ratified an agreement between the Governments of Ukraine and Germany to raise €25.5 million through KfW to provide preferential mortgage loans to internally displaced persons who are citizens of Ukraine.
The first phase of the project was launched on 17 May 2021. By 1 November 2023, 650 families of internally displaced persons had received concessional housing loans under the programme. Thus, 1530 people have been provided with their own housing.
On 26 October 2023, following the fifteenth selection round, another 130 people were selected to receive a mortgage loan under the programme. These particular transactions will be financed from the proceeds of repayment of loans previously issued under the programme.
The register of candidates for the programme currently includes more than 34.9 thousand people.
The additional funding will make it possible to issue about 400 more soft loans for internally displaced persons in 2024.
The proceeds from the repayment of loans under the programme are used for new lending.
The transparency and compliance with all project conditions have been confirmed by the results of an audit conducted by the international audit company RSM Ukraine LLC.
Key terms of the Housing for Internally Displaced Persons project.
Concessional loans are provided to internally displaced persons at 3% per annum.
The minimum down payment is 6% of the cost of the housing to be purchased.
The loan term is 30 years.
The standard area of housing that can be borrowed is 52.5 sq m for a family of 1 or 2 people and an additional 21 sq m for each additional family member.
A citizen chooses a loan object in any region of Ukraine, regardless of the place of registration. The housing must be built no more than 50 years ago or reconstructed no more than 35 years ago.
The loan object may not be located in the territories of active hostilities or temporarily occupied by the Russian Federation, included in the List of territories where hostilities are (were) conducted or temporarily occupied by the Russian Federation, approved by the Ministry of Reintegration, for which the date of completion of hostilities or temporary occupation has not been determined.
Applicants for the programme have two ways to apply for registration:
- remotely through the Unified State Web Portal of Electronic Services administered by the state enterprise Diia;
- in person at all regional offices of the State Agency for Youth and Housing.
The selection of loan recipients from among the registered candidates is carried out using an electronic service - a random number generator under the control of the international Implementation Consultant IPC GmbH.