Malta subsidy to mitigate impact of Ukraine war on grain prices gets Brussels green light

A Maltese scheme aimed to cushion the impact Russia’s invasion of Ukraine has had on grain prices was approved by the European Commission on Wednesday.

The €30 million subsidy scheme will support companies active in the importation, manufacturing and wholesale of grains and other similar products.

The scheme was approved under the state aid Temporary Crisis Framework, adopted by the Commission on 23 March that recognises the EU economy is experiencing a serious disturbance.

Only today, the HICP index showed that food prices in Malta rose 9% in April when compared to the same month last year. The National Statistics Office said the higher price for bread impacted the food index. Overall, Maltese consumers saw prices increase by 5.4% in April, almost one percentage point more than March.

The Commission’s green light offers reprieve at a time when inflation is eroding purchasing power.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “This €30 million scheme will enable Malta to mitigate the economic impact of Putin's war in Ukraine and to support companies active in the importation of grains and other similar products affected by the current geopolitical crisis.”

She said the EU will continue to stand with Ukraine and its people, while working closely with member states to ensure that national support measures can be put in place in a timely, coordinated and effective way, while protecting the level playing field in the single market.
Malta had notified the Commission under the Temporary Crisis Framework of the €30 million scheme to support companies of all sizes active in the importation, manufacturing and wholesale of grains and other similar products. The aid will take the form of subsidised loans.

The maturity of the loan is limited to two years and the annual interest rates on the loans respect the minimum levels set out in the Temporary Framework. Loan contracts will have to be signed by 31 December 2022.