Canada loaning Ukraine $120M as tensions with Russia escalate

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The Canadian government is loaning up to $120 million to the Ukrainian government amid the ongoing crisis with neighbouring Russia.

Prime Minister Justin Trudeau made the announcement Friday morning, hours after the United States met with Russia to lower the temperature on the Ukrainian standoff.

“Russia is aiming to destabilize Ukraine, including economically. This loan will help support Ukraine’s economic resilience,” Trudeau said.

“We’re also exploring other options to provide financial and other supports … Again, Canada calls on Russia to deescalate and engage in meaningful dialog.”

Furthermore, Canada has also offered to provide a technical assistance grant of up to $6 million to support the implementation of the loan. Canadian and Ukrainian officials are already meeting to discuss the potential terms of the loan and a timeline for its implementation, officials said in a news release Friday.

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“We have always been a friend to Ukraine; we will always be there with the necessary supports,” Trudeau added.

With an estimated 100,000 Russian troops massed near Ukraine, many nations fear Moscow is preparing an invasion although Russia denies that. The U.S, Canada and its allies are working to present a united front to prevent that or coordinate a tough response if they can’t.

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Ukraine’s economy has been crushed by weeks of tensions as Russia masses troops near its borders, while talks between Western nations and Moscow fail to produce breakthroughs.

The risk of conflict comes with Ukraine’s central bank already grappling with inflation that hit double digits last year on higher energy and food prices, and prompted five rate rises in 2021.

 Joly' 1:50 Russia faces severe sanctions if it advances further into Ukraine: Joly

Russia faces severe sanctions if it advances further into Ukraine: Joly

Russian President Vladimir Putin has claimed the increased military presence is in response to provocations from the West.

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On Wednesday, United States President Joe Biden said he expects Putin to invade Ukraine, but that Russia would pay a “dear price” in lives lost and a possible cut-off from the global banking system if it does.

Canadian Foreign Affairs Minister Melanie Joly said Thursday Canada will join allies in imposing severe sanctions on Russian officials if the country takes further military action to compromise Ukrainian sovereignty.

More to come.

— with files from Reuters and The Associated Press

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