“The multi-billion dollar loan is proposed to be divided into two parts: 30 billion – for budget support, 60 billion – for military”, — write: www.radiosvoboda.org
The multibillion-dollar loan is proposed to be divided into two parts: 30 billion for budget support, 60 billion for military support.
According to the head of the European Commission, Ursula von der Leyen, thanks to military aid, Ukraine can confidently oppose Russia and at the same time integrate more closely into the European defense and industrial base.
“The funds will be used for the purchase of equipment primarily in Ukraine, the EU and the EEA/EFTA countries (the zone where the rules of the EU single market apply – ed.). But, if these necessary purchases are not possible in this region or in a timely manner, then it may also sometimes be possible to purchase equipment outside the EU and the geographic region and the geographic region I have just described,” said the head of the European Commission, Ursula von der Leyen, presenting the proposal.
This rule of spending money on military needs became a compromise between groups of EU states, one of which advocated the acquisition of equipment primarily on European markets, in order to facilitate the scaling up of defense production. This camp was headed by France.
To a certain extent, it was opposed by a group of states, among which, in particular, the Netherlands, which advocated giving Ukraine the opportunity to dispose of funds as it sees fit. In particular, to spend them on American weapons, for example, within the framework of the PURL initiative.
“In general, European preference, but according to the cascade principle: European preference first of all, and if it is not possible – then procurement abroad… In parallel, we must strengthen our defense and industrial base, and this is important not only for Ukraine, but also for our own security. Therefore, there is a strong interest in giving a strong incentive to primarily purchase in the specified region,” the head of the European Commission explained the essence of the compromise.
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Economic Commissioner Valdis Dombrovskis said the roughly €60 billion earmarked to support Ukraine’s defense efforts would enable it to acquire the equipment it needs to defend itself, while providing a “very significant” boost to Europe’s and Ukraine’s fast-growing defense industries.
“Today’s offer shows that we are determined to continue providing Ukraine with the necessary support,” he also emphasized.
Ukraine will need EUR 30 billion of budget support to promote reforms and modernize the country, in particular for EU membership, von der Leyen emphasized. The President of the European Commission emphasized once again that Ukraine will not have to repay this loan until Russia compensates for the damages caused to it. For this purpose, the EU will continue to keep its assets frozen.
“Ukraine’s financial needs will be ensured, and the expected budgetary support will be guaranteed in the form of a loan, which will be repaid with reparations belonging to Ukraine from Russia,” – emphasized the European Commissioner for Enlargement, Marta Kos.
The proposals of the European Commission must be approved by the European Parliament. The goal is to start paying tranches in April 2026, given their urgency for Ukraine.
EU leaders on the night of December 19 approved the decision to grant Ukraine 90 billion euros for the next two years. It is a loan supported by the EU budget, and not a reparation loan, which has been actively discussed in recent weeks.
The reparation loan was considered as a mechanism of financial support for Ukraine in the amount of up to 90 billion euros for the next two years due to the income and cash balances of frozen Russian assets, the total volume of which in Europe is estimated at approximately 210 billion euros.
Russia categorically rejects any attempts to confiscate its funds and calls the possible use of these assets for the benefit of Ukraine theft.
