The European Union has agreed to allow the United Kingdom to join a €90 billion loan program aimed at supporting Ukraine. This initiative is expected to facilitate the procurement of military equipment for Ukraine, potentially amounting to €60 billion over the next year.
Under current EU regulations, British companies are eligible for contracts only if they cannot be fulfilled by EU manufacturers. UK ministers are seeking to negotiate broader access, enabling their companies to compete on equal terms.
Maros Sefcovic, the EU Commissioner for Brexit, indicated that the EU is open to greater UK involvement in the program as part of a broader effort to reset relations. He noted that such cooperation could be mutually beneficial.
The UK’s contribution is anticipated to be around £390 million (€455 million), although the final amount has yet to be confirmed. A source from The Times has reported that the UK is in discussions regarding its participation in the loan program. EU representatives have expressed no objections to British defense companies participating in tenders for Ukraine’s procurement funded by the loan.
The loan terms stipulate that the UK will pay its “fair share” of interest, estimated at approximately €3 billion annually.
It is important to note that the European Commission has postponed the first tranche of the €90 billion loan for Ukraine.
Additionally, the recent electoral victory of Peter Madyar, leader of the Tisza party in Hungary, does not automatically lead to the unblocking of the EU’s loan for Ukraine. Madyar has stated his willingness to discuss the matter with European leaders; however, the decision was effectively made by the European Council last December, granting Hungary, Slovakia, and the Czech Republic the option not to participate in the program.
Even if Hungary lifts its objections, Slovakia remains a hurdle, as Prime Minister Robert Fico has not altered his position. Furthermore, the formation of a new Hungarian government is likely to introduce additional delays.
Slovakia has already announced that it will not block the loan for Ukraine.
The EU has permitted the UK to join a €90 billion loan program for Ukraine, which aims to support military procurement. UK ministers are negotiating for broader access for their companies, while the loan terms include significant annual interest payments.