EU agrees €90 billion Ukraine loan after plan to use Russian assets collapses

EU leaders have agreed to raise a €90 billion loan for Ukraine using the bloc’s shared budget, abandoning a proposal to back the funding with immobilised Russian sovereign assets after months of internal deadlock.

The deal, struck after more than 16 hours of talks at a Brussels summit, is intended to secure Ukraine’s financing needs for the next two years, amid warnings from Kyiv that the country could face financial collapse in early 2026 without additional support, Caliber.Az reports via foreign media.

The agreement comes as European capitals seek to reinforce their political relevance alongside US-led efforts to broker an end to Russia’s nearly four-year war against Ukraine.

EU governments had previously explored using around €210 billion in Russian state assets — most of them held in Belgium — to underpin a so-called reparations loan for Kyiv. However, the plan fell apart after Belgium demanded extensive and uncapped guarantees from other member states to cover potential legal claims and retaliation risks from Moscow. Several capitals rejected those terms as unacceptable.

France and Italy subsequently pushed for an alternative solution based on the EU’s common budget, which ultimately gained sufficient backing among leaders.

Under the final arrangement, the European Commission will borrow €90bn on capital markets, using unspent capacity in the EU budget as collateral. Leaders also agreed that the scheme would not impose direct financial obligations on the Czech Republic, Hungary and Slovakia, which had opposed using EU funds for Ukraine.

The outcome is seen as a political setback for German Chancellor Friedrich Merz and European Commission President Ursula von der Leyen, both of whom had strongly supported the Russian-assets-based proposal and urged Belgium to drop its objections.

“We always said that this was about getting Kyiv the money — not about how,” one EU official involved in the negotiations said.

By Vugar Khalilov