Council agrees recommendation on the exchange of Ukrainian hryvnia banknotes into EU currencies to support people escaping the war in Ukraine

At today’s meeting, the Permanent Representatives Committee endorsed a Council recommendation on the conversion of hryvnia banknotes into the currency of member states hosting people escaping the war in Ukraine. The objective is to further support refugees who are having difficulty exchanging their banknotes into EU currencies.

The recommendation invites member states to set up national schemes that would allow for the conversion of hryvnias under similar conditions across the EU. The schemes would allow displaced persons from Ukraine, including children, to exchange up to 10 000 hryvnias (approximately € 310), per person. This would be free of charges, and at the official exchange rate as published by the National Bank of Ukraine. The duration of these schemes would be a minimum of three months.

Next steps

The recommendation will now be formally adopted by the Council by written procedure. The tentative date for adoption is 19 April.

Recommendations are not legally binding acts. The actual implementation and setting up of the schemes are therefore to be decided by the member states according to their national situations. A number of EU countries have already put in place national arrangements for this purpose.

Background

Due to the disruption caused by the Russian military aggression, the National Central Bank of Ukraine had to suspend the exchange of hryvnia banknotes into foreign currencies in order to protect the country’s limited foreign exchange reserves. This has affected the convertibility of the hryvnia banknotes in EU countries, where many banks were unwilling to exchange the hryvnia due to exchange rate risks.

On 1 April the Commission presented a proposal for a Council recommendation in order to promote a coordinated approach for national schemes put in place by member states. This proposal had the aim of offering displaced persons from Ukraine the same conditions for converting hryvnia banknotes into local currency independently of the member state that hosts them, establishing a level playing field for the credit institutions and preventing possible speculative behaviour on the market.

Since the Russian invasion of Ukraine, more than four million people, escaping the war have arrived in the EU. The EU and its member states will continue to show their resolute support to Ukraine and its citizens, in the face of this unprecedented act of aggression by Russia. They are providing humanitarian assistance and temporary protection, including access to their labour markets, housing, healthcare and education systems. The recommendation complements these efforts.