The European Commission on 14 January formally proposed a €90 billion loan to Ukraine for 2026-2027, with roughly two-thirds — €60 billion — dedicated to military assistance and the remaining €30 billion allocated for budget support. The package builds on December's European Council agreement. Brussels reserves the right to use frozen Russian assets to cover the debt.
Weapons take priority in EU's major Ukraine commitment
According to the Commission's press release, the legislative package consists of three proposals: a new proposal establishing the Ukraine Support Loan, an amendment to the existing Ukraine Facility, and an amendment to the Multiannual Financial Framework Regulation allowing the EU budget "headroom" to cover the loan.
The support will help Ukraine strengthen defense capabilities and contribute to its closer integration with Europe's defense industrial base. Budget support will ensure continued state functions and basic public services.
As US President Donald Trump keeps pushing for Kyiv-Moscow negotiations, European Commission President Ursula von der Leyen framed the package as essential for Ukraine's negotiating position.
"We all want peace for Ukraine. And for that Ukraine must be in a position of strength — on the battlefield and at the negotiating table," she said. "Above all it reaffirms Europe's unwavering commitment to the security, defense, and future prosperity of Ukraine."
Enhanced cooperation enables the deal
The agreement came through "enhanced cooperation," a mechanism allowing EU member states to collaborate in specific areas when the bloc as a whole cannot reach consensus within a reasonable timeframe. The support will be financed through common EU borrowing from capital markets, guaranteed by the EU budget headroom — the same approach used for previous assistance programs including Macro-Financial Assistance+, Ukraine Facility, and the G7-led Extraordinary Revenue Acceleration loans initiative.
Commissioner for Economy Valdis Dombrovskis called the proposals "an essential step towards ensuring just and lasting peace that guarantees real, long-term security for both Ukraine and Europe." Enlargement Commissioner Marta Kos emphasized that EU support "goes beyond Ukraine's funding needs," providing "a clear reform plan that helps strengthen public institutions, attract investment, and move closer to EU membership."
Next steps and conditionality
The legislative proposals now head to the European Parliament and Council. For first disbursements to begin in the second quarter of 2026, as agreed at December's European Council, the Commission said swift adoption is essential.
Strong conditionality mechanisms remain in place, including rule of law measures and anti-corruption requirements under the Ukraine Plan.
