The European Commission has approved a €30 million Malta government scheme to support companies in the importation, wholesale and manufacture of grain products impacted by Russia’s invasion of Ukraine.
The scheme, ‘MDB Subsidised Loan Scheme’, was approved under the State aid Temporary Crisis Framework adopted by the Commission on March 23, which recognises that the EU economy is experiencing a serious disturbance.
Russia’s invasion of Ukraine has put massive pressure on wheat prices, as both countries are major producers and exporters of grain.
Back in March, Malta’s top wheat importers sounded the alarm about the possibility that other countries will start to restrict exports and has called for a national strategy on the importation of wheat.
Earlier this month, Prime Minister Robert Abela said "millions of euro" have been allocated to keep flour prices stable.
Under this new measure, the aid will take the form of subsidised loans.
European Commission Vice-President Margrethe Vestager, who is in charge of the competition policy said the €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.”
“We continue to stand with Ukraine and its people. At the same time, we continue 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,” he said.
The Maltese measure
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 in the context of Russia's invasion of Ukraine.
The loan is limited to two years. All loan contracts must be signed by December 31 2022.
Nationalist Party spokesperson Peter Agius, who first called on the European Commission to safeguard prices, welcomed the news on Wednesday.
"This is politics which shows results. Following pressure from Bernard Grech, the European Commission today approved a €30 million aid scheme to help Maltese consumers on the price of bread. We will continue to work," he said.