EU agrees €90 billion loan to Ukraine, but squabbles over frozen Russian assets expose the bloc’s deep divisions |
By agreeing to provide a loan of €90 billion (£79 billion) for the years 2026-2027, EU leaders have set the direction for the future of support for Ukraine.
At stake at the meeting of the European Council on December 18 was not just Kyiv’s ability to continue to defend itself against Russia’s ongoing aggression, but also the credibility of the EU as a player in the future of European security.
The key decision for the EU’s leaders was whether, and how, they would provide financial support for Ukraine over the next two years. Europeans have provided a vital drip-feed of ongoing financial assistance to Kyiv throughout almost four years of war.
But they have also struggled to fill, in its entirety, the hole created by the withdrawal of US support since the return of Donald Trump to the White House in January 2025.
The estimated €136 billion of budget support needed by Ukraine in 2026 and 2027 is a relatively fixed figure regardless of whether any peace initiative comes to fruition. A large part of it – €52 billion in 2026 and €33 billion in 2027 – is for military support.
The EU-agreed loan of €90 billion, “based on EU borrowing on the capital markets backed by the EU budget headroom”, thus covers at least the essential military needs of Ukraine. The loan will either contribute to the ongoing war effort or help create a sufficiently large and credible defence force to deter any future aggression by Russia.
Brussels is now the most important financial partner for Ukraine by any measure.
To fund the support the EU wants to provide to Ukraine, the commission developed two proposals. The most widely supported – and........