European Union leaders have opted to secure a 90 billion euros ($145 billion Cdn) loan for Ukraine over the next two years for defense against Russia. This decision involves borrowing funds instead of using frozen Russian assets, as there was disagreement about financing Kyiv with Russian sovereign funds. The European Commission has been tasked with exploring a reparations loan based on immobilized Russian assets, although this approach faced challenges, particularly due to opposition from Belgium, the main holder of these assets.
António Costa, the chair of the EU summit, announced the approval of the 90 billion euros loan for Ukraine during a press conference in Brussels. Italian Prime Minister Giorgia Meloni expressed satisfaction with the decision, highlighting the solid legal and financial foundation behind it.
Ukraine expressed gratitude towards the European Union for the financial aid. Without this support, Ukraine would have faced financial difficulties by the second quarter of the following year, potentially leading to a loss in the conflict against Russia. President Volodymyr Zelenskyy emphasized the significant boost in resilience that this support provides.
Initially, the notion of EU borrowing faced challenges, with Hungary opposing it. However, Hungary, Slovakia, and the Czech Republic eventually agreed to the plan, ensuring that it would not impact them financially. Hungarian Prime Minister Viktor Orbán stressed the avoidance of war with Russia through the use of Russian assets.
The leaders made it clear that Russian assets worth 210 billion euros ($339 billion Cdn) will remain frozen until Moscow pays war reparations to Ukraine. German Chancellor Friedrich Merz underscored that this move benefits Ukraine while putting pressure on Russia.
Belgium’s concerns led to the adoption of an alternative plan due to questions surrounding the Reparations Loan. Belgian Prime Minister Bart De Wever emphasized the unity and rationality displayed by the EU in resolving the issue.
Russian President Vladimir Putin criticized the shift from the original scheme, citing potential repercussions and damage to the eurozone’s reputation. Putin labeled the situation as “daylight robbery,” highlighting the implications for trust in the eurozone.
The EU leaders’ determination to secure financial backing for Ukraine, despite challenges, aimed to demonstrate unity and strength in the face of external criticism. EU foreign policy chief Kaja Kallas stressed the urgency of finding a solution to sustain Ukraine’s defense efforts. President Zelenskyy emphasized the moral significance of utilizing Russian assets for Ukraine’s benefit.
