BRUSSELS – European Union leaders reached a landmark agreement early Friday to provide Ukraine with a substantial €90 billion ($105 billion) defense loan through a collective borrowing mechanism, concluding extensive negotiations at the Brussels summit. This financial package, designed to sustain Ukraine’s military efforts against Russian aggression for the next two years, represents a strategic pivot from earlier proposals to utilize frozen Russian assets.
The funding arrangement emerged as a compromise solution after technical and political complexities prevented immediate use of approximately €210 billion in immobilized Russian assets held within EU jurisdictions. Hungarian Prime Minister Viktor Orbán, previously opposed to unanimity-based financial measures, ultimately acquiesced to the mechanism alongside Slovak and Czech leadership after securing provisions that would not directly impact their national finances.
EU foreign policy chief Kaja Kallas emphasized the critical nature of the decision, stating, “We simply cannot afford to fail in supporting Ukraine’s defense capabilities.” The sentiment was echoed by German Chancellor Friedrich Merz, who characterized the agreement as “favorable news for Ukraine and unfavorable for Russia.”
Ukrainian President Volodymyr Zelenskyy, participating in the summit deliberations, had previously advocated for direct utilization of Russian assets. However, resistance from Belgium—where €185 billion of Russian assets are held—proved decisive in shifting the approach toward EU-backed borrowing.
Belgian Prime Minister Bart De Wever praised the alternative arrangement, noting that “rationality has prevailed” and prevented institutional “chaos and division.” The frozen Russian assets will remain immobilized until Moscow provides war reparations to Ukraine, at which point they could potentially service the loan repayment.
EU summit chairman Antonio Costa confirmed that the European Commission received authorization to develop the loan infrastructure with urgency, utilizing the EU budget as collateral. This financial intervention addresses concerns that Ukraine would face fiscal exhaustion by the second quarter of 2026 without substantial international support, potentially altering the conflict’s trajectory.