The European Commission has proposed three options for long-term financing of Ukraine to the EU countries. The main goal, as before, is to provide a reparations loan using the frozen assets of the aggressor country russia.
According to Bloomberg, this is stated in a letter from the head of the European Commission Ursula von der Leyen to European leaders.
The document says that the EC presents three options for financing Ukraine:
- Provision of grants by EU countries in the amount of at least EUR 90 billion for 2026-2027.
- Adoption of joint EU debt to issue a loan.
- Use of frozen russian funds to secure the loan.
Ukraine needs a huge injection of funds to survive in a full-scale war with russia. The country needs at least EUR 51.6 billion for military spending alone.
The letter from the head of the European Commission says that the financial pressure is likely to be especially strong in 2026 and 2027, when Ukraine's needs could exceed EUR 70 and EUR 64 billion, respectively.
The EU's goal is still to provide Ukraine with a loan using almost EUR 200 billion of frozen russian assets. These are held by Euroclear, an international company based in Belgium. Under this option, Euroclear will receive a debt contract that guarantees that any future claims by russia will be covered by the EU and individual bloc countries.
It is emphasized that Ukraine will have to repay the loans only if the aggressor country agrees to compensate for the damage caused by the war.
The European Commission has included some concessions in the document to address some of Belgium's concerns, including the possibility of using EUR 25 billion related to russian sovereign assets. She also proposed to cover the risks associated with bilateral investment treaties, as well as the risks arising after the lifting of the immobilization of assets.
As the Ukrainian News agency earlier reported, in late October, Belgium blocked the EU initiative to provide Ukraine with a reparations loan, which was planned to be financed from the proceeds of frozen russian assets.
Later, it became known that the European Commission and Belgium would hold crisis talks amid Brussels' reluctance to authorize the use of frozen russian assets.
We also wrote that back in January of this year, the administration of US President Donald Trump supported the idea of confiscating frozen russian assets.
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