European Commission HQ lit with Ukraine flag

View from Brussels: Ukraine’s brightest get EU windfall

Image credit: European Union 2022

Ukraine’s start-up scene is set to benefit from €20 million in EU funding, as Brussels hopes to integrate the country further into the West’s tech sector. Full EU membership anytime soon still looks like a very unlikely prospect but Kyiv can expect more perks like this in the future.

The European Innovation Council (EIC) last week announced the €20m fund dedicated solely to helping Ukraine’s start-up sector become more closely aligned with the rest of Europe’s.

Under the new fund, grants of up to €60,000 and non-financial support will be made available. The first call for applications will launch on 23 June and the European Commission hopes that applicants will be emboldened to then apply for more funding from the EIC.

"Ukraine has a vibrant deep-tech community and strong potential for creating breakthrough innovations," said EU research chief Mariya Gabriel, who also added that the sector will play an essential role in rebuilding the country’s destroyed infrastructure.

According to the Ukrainian government, more than 70 per cent of start-ups are still going about their business, despite Russia’s brutal invasion. That is why this injection of cash will be crucial for many start-ups that are only just finding their feet.

The EIC will hope that this new initiative will be somewhat of a distraction from its internal problems, which have caused a lot of delays in getting grants and loans into the hands of successful applicants.

A European Parliament inquiry into what has gone wrong is pending, while the Commission has previously admitted that ongoing restructuring had helped cause the delays.

What the future holds

Ukraine’s bid to become a full-fledged member of the European Union is going to be the big political item on the agenda of a European Council summit of government leaders on 23 June.

The application was submitted not long after Vladimir Putin illegally invaded Ukraine, which also prompted Georgia and Moldova to hand in requests as well, seeking both the defence and economic perks that membership promises.

EU leaders will not give in to calls to grant Ukraine immediate membership and may not even grant the nation candidate status, which would potentially trigger years of negotiations on the various details needed to become a member of the club.

That politicking aside, Ukraine can at least rely on its association of the EU’s flagship research programme, Horizon Europe, which also kicked in last week. The EU has waived the financial contributions normally required for 2021 and 2022.

EU heads hope that this will prompt even greater collaboration between researchers and scientists, especially in the field of clean energy. This is all supplemented by a €25m fund just for Ukrainian researchers who have fled the fighting.

Ukraine may now be enjoying the spoils of Horizon but the UK still is not. The chances of a compromise on issues related to the Northern Ireland Protocol are slipping away and with it the hopes of UK-based researchers of securing a last-minute reprieve.

The European Commission had put the brakes on the UK's association until that issue was solved.

Indeed, it is now likely that if no agreement is in place by the end of the month, then the UK government will move on with its own arrangements for research and innovation funding, which most concerned parties say will pale in comparison to what Horizon offers.

That is a shame because last week the Commission unveiled its draft budget for 2023, which plans to allocate €12.3 billion to the Horizon programme, a €100 million increase on 2022’s proposal.

Nearly €2 billion in grants from the bloc’s pandemic recovery fund is also expected to be thrown into the mix. MEPs and national governments will now have their say over the budget before it can be finalised.

Cuts to the European Space Programme and some digital funding may not sit well with some lawmakers and countries but the Council was the one that insisted on a smaller overall budget for the 2021-2027 period so they will have to live with the consequences.

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