EU states agree on legal basis for providing Ukraine with loan of EUR 90 bln
The EU Council announced on Wednesday that it had agreed on the position of EU member states on the legal basis for providing Ukraine with financial support in the amount of EUR 90 billion in 2026-2027.
“The Council now aims for a speedy agreement with the European Parliament to allow the first payment to be disbursed early in the second quarter of this year. The Ukraine support loan will help Ukraine address its urgent financing needs as Russia continues its war of aggression. To that end, it will specifically aim to support Ukraine’s general budget and defence needs,” a published communiqué reads.
“As also agreed by the European Council, the loan will be financed through EU borrowing on the capital markets and will be backed by the EU budget. The loans will become repayable only once Russia has paid war reparations to Ukraine. Furthermore, the financing will help strengthen the European and Ukrainian defence industries,” the document reads.
“Today’s agreement shows that the EU continues to act decisively in support of Ukraine and its people. The new financing will help ensure the country’s fierce resilience in the face of Russian aggression. At the same time, we are sending a strong signal that the sovereignty and territorial integrity of states must be fully respected, in accordance with international law,” Makis Keravnos, Minister of Finance of the Republic of Cyprus, presiding in the EU Council, said.
At the same time, it is clarified that “today’s decision was taken through the enhanced cooperation procedure with the participation of 24 member states.”
The communiqué explains that the EU will provide funding to Ukraine in two ways: EUR 30 billion will be provided as macroeconomic support to Ukraine, channelled via macro-financial assistance (MFA) or implemented through the Ukraine Facility, the EU’s dedicated instrument for providing Ukraine with stable and predictable financial support, and EUR 60 billion will be used to support Ukraine’s capacity to invest in defence industrial capacities and to procure military equipment. The funding will give Ukraine crucial and timely access to defence products from both the Ukrainian and EU defence industries.
“The funding will give Ukraine crucial and timely access to defence products from both the Ukrainian and EU defence industries. The financial and economic assistance available under the loans will be made accessible in line with Ukraine’s financing needs, determined by a financing strategy to be prepared by Ukraine itself. The Council will need to approve this strategy following a Commission assessment,” the communiqué reads.
In all cases, funding will be subject to strict conditions for Ukraine, such as respect for the rule of law, including the fight against corruption.
