EU member states approve 90 bn euro loan to Ukraine
On Wednesday, the ambassadors of the European Union member states approved a 90 billion euro loan to Ukraine that was agreed at last year’s European summit. The European Parliament still has to agree to the terms of the loan.
In mid-January, the European Commission put forward a proposal for the loan, which is intended to cover around two thirds of Ukraine’s financing needs for 2026 and 2027. Of the total amount, 30 billion euros are earmarked for macroeconomic support and 60 billion euros for military assistance.
Ukraine will also be required to prioritise the purchase of weapons produced domestically or in Europe. However, if equipment is urgently needed and not available in Ukraine or the EU, "targeted exceptions" will be allowed, enabling Kyiv to turn to third countries, such as the United States, Canada or the United Kingdom.
Member states also want these third countries to be directly involved in the loan for "specific defence products". They further agreed that interest on the loan will be paid from the EU budget. Hungary, Slovakia and the Czech Republic, which do not wish to provide military support to Ukraine, had pledged not to veto the agreement in return for assurances that the loan would have no financial implications for them.
"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," said Cypriot finance minister Makis Keravnos. "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."
Time is running out
The European Parliament is due to vote on the loan later this month, and the member states and Parliament must also agree on the terms and conditions before the first tranche of the loan can be transferred.
Ukraine needs the loan as soon as possible, as it threatens to run out of funds by April. But the 90 billion euro loan does not cover all of Ukraine's financial needs. According to estimates by the International Monetary Fund (IMF), the country requires at least 135 billion euros for 2026 and 2027. The EU is looking toward international partners to cover the remainder.
PHOTO © Sergei GAPON / AFP
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