European Union leaders have agreed to provide Ukraine with a €90bn loan to cover its most urgent financial needs over the next two years, but failed to reach consensus on securing the funding directly against frozen Russian assets held within the bloc. Instead, the loan will be backed by EU borrowing and the union’s budget, with repayment expected only if Russia eventually pays reparations.
EU officials described the agreement as a significant political and financial commitment to Kyiv. The deal includes a provision allowing the EU to reserve the right to use immobilised Russian assets in the future to repay the loan, but no immediate action will be taken to seize or directly leverage those funds. Around €210bn in Russian assets remain frozen in the EU, most of them held in Belgium, which raised legal and financial concerns about potential compensation claims from Moscow.
Differences among member states prevented the adoption of the more aggressive option. Some governments warned that using frozen assets could expose the EU to major legal risks, while others argued it was the strongest way to ensure Russia bears the financial cost of the war. Ultimately, compromise was reached when several central European countries agreed to back the EU-budget-based loan, provided they were not required to contribute to loan guarantees.
Supporters of the agreement said the loan sends a clear signal of long-term support for Ukraine and ensures continuity of funding for both civilian needs and defence production. Ukrainian President Volodymyr Zelenskyy welcomed the decision, having warned that delays in financing could undermine Ukraine’s ability to sustain key military capabilities, including drone production.
While the €90bn package will cover most of Ukraine’s needs through 2027, EU officials stressed that additional contributions from non-EU allies will still be required to meet the country’s full military and civilian funding requirements. The debate over whether to use frozen Russian assets directly is likely to continue as the war and Ukraine’s financial pressures persist.