EU unveils €90 billion defence-focused loan to Ukraine
Brussels leaves open the possibility of buying weapons from the US
The European Commission formally presented a €90 billion loan package to Ukraine on Wednesday, as Brussels races to support Kyiv’s war effort amid increasingly fierce Russian attacks and US-led efforts to end the war.
Two-thirds of the package will be used to provide military assistance to Ukraine, which could involve procuring weapons and ammunition from outside the EU, Commission President Ursula von der Leyen said. The remaining €30 billion will be used to plug Kyiv’s looming budget hole.
Ukraine requires €135.7 billion in military and budgetary support in 2026 and 2027, according to the Commission. This includes €52.3 billion in fiscal support and €83.4 billion in military assistance. Kyiv is expected to run out of money in April, according to the Commission.
“With this support, we are making sure that Ukraine can, on one hand, bolster its defence on the battlefield and strengthen its defence capabilities – so all the military needs – and on the other hand, keep the state and the basic services running,” von der Leyen told reporters.
She added that the military support will function on a “cascading principle”, whereby Ukraine would only source weapons from outside the bloc if no adequate European military equipment is available.
“European preference first, and then if not possible, then the purchase abroad,” von der Leyen said.
France has long pushed for a ‘European preference’ in procuring military equipment. However, Germany and many Eastern EU countries argue that the bloc should remain open to purchasing defence equipment from Washington, despite waning US support for Kyiv and recent tensions over President Donald Trump’s threats to invade Greenland, a semi-autonomous Danish territory.
The loan will operate on the basis of “enhanced cooperation” among EU countries, allowing Hungary, Czechia, and Slovakia to opt out of the scheme. The three countries are deeply sceptical about providing financial assistance to Kyiv.
Economy Commissioner Valdis Dombrovskis said the EU is “working” with its allies to ensure that Ukraine’s remaining financial needs are met, with Norway, the International Monetary Fund, and the G7 group of Western countries expected to disburse billions euros worth of additional aid to Kyiv over the coming months.