The EU has officially approved an aid package of EUR 1 B for Ukraine in a bid to help the interim government deal with the deep financial problems of the country.

At a meeting of EU Foreign Ministers in Luxembourg, the customs duties on Ukrainian goods were lowered in a move expected to save the country around EUR 500 M a year.

The EU Foreign Ministers also added four people on the list of 18 Ukrainians subject to an EU visa ban and asset freeze since March 5 for abuse of state funds, according to reports of The Voice of Russia.

The EU medium-term loan of almost EUR 1 B aims to help Ukraine cover its balance-of-payments needs and it supplements aid of EUR 610 M which has been approved but not yet transferred.

The reduction in customs duties for Ukrainian goods by November 1, 2014 is a unilateral measure which will not affect duties on exports from the 28 EU countries to Ukraine.

The measure is the first stage of the free trade agreement, which is to be signed between EU and Ukraine later in 2014.

The agreement is related to the Association Agreement which former President Viktor Yanukovych refused to sign in November, triggering protests which lead to his ouster.