Japan Provides Ukraine with $1.3 Billion Grant Through ERA Mechanism

Ukraine has received a significant grant of $1.3 billion from Japan to support social expenditures, according to information released by the Ministry of Finance of Ukraine. This financial assistance was provided through the World Bank project "PEACE in Ukraine" and is part of the Extraordinary Revenue Acceleration (ERA) mechanism established by the G7, which aims to provide a total of $50 billion for Ukraine.

This tranche marks Japan's second payment under the ERA initiative. The funds have been directed to the multilateral trust fund known as "Facilitation of Resources to Invest in Strengthening Ukraine" (F.O.R.T.I.S.), before being transferred to the general fund of the state budget.

In a press release published on Wednesday, Ukraine's Minister of Finance, Serhiy Marchenko, emphasized that these funds will be utilized to reimburse social expenditures, including salaries in the public sector, medical services, and pensions. "This is a significant contribution to Ukraine's financial stability and the timely fulfillment of social obligations," the press release quoted Marchenko as saying.

"Thanks to this support, the total amount of funding mobilized through the 'PEACE in Ukraine' project now exceeds $53 billion," he added.

In February 2026, Kyiv signed a grant agreement for $690.8 million, financed by Japan and Canada from frozen Russian assets. Japan contributed $544 million, marking its first use of the ERA tool, which directs interest from frozen Russian assets to Ukraine, a country that still heavily relies on external financing.

According to the press release, Japan remains the second-largest donor and the fourth-largest financial partner of Ukraine. Since the onset of the war in February 2022, Japan's total budget support has exceeded $10.7 billion, including more than $2.7 billion in grants.

The ERA mechanism, agreed upon by G7 leaders at a summit in June 2024 in Italy, provides Ukraine with loans that it is not obligated to repay, which is a crucial element in financing the country's needs amid war and economic instability.