EU approves €90 billion loan to Ukraine without using frozen Russian assets

• EU leaders approve a €90 billion loan to Ukraine to cover budget shortfalls, providing a crucial lifeline while frozen Russian assets remain untapped.
• Ukrainian President Volodymyr Zelensky thanks the EU for a €90 billion loan to support Ukraine’s budget and defence.

European Union leaders on Friday reached an agreement to provide Ukraine with a €90 billion loan to cover its looming budget shortfalls, though they failed to settle on using frozen Russian assets to finance the aid.

The deal, struck at midnight during a summit in Brussels, provides a vital lifeline to Kyiv as U.S. President Donald Trump pushes for a swift agreement to end the nearly four-year-long war in Ukraine.

European Council President António Costa, who chaired the summit, said the decision “will provide Ukraine with the means to defend itself and support the Ukrainian people.”

After intense negotiations, EU leaders settled on a budget-backed loan that will fund Ukraine over the next two years. The initial plan to use roughly €200 billion in frozen Russian central bank assets fell apart after Belgium, which holds the majority of the assets, demanded guarantees on sharing responsibility for their use.

In a post-summit press conference, Belgian Prime Minister Bart De Wever described the outcome as a relief. “It was extremely risky and raised many questions… like a sinking ship, similar to the Titanic. It is now settled, and everyone feels relieved,” he said.

German Chancellor Friedrich Merz, who had strongly advocated using Russian assets, said the EU sent “a clear message” to Russian President Vladimir Putin by approving the €90 billion support. European Commission President Ursula von der Leyen added that Ukraine will not need to repay the loan until Moscow compensates for war damages.

The joint borrowing required unanimous approval from all 27 EU member states, but Hungary, Slovakia, and the Czech Republic were granted exemptions to prevent a blockade.

Ukraine’s Urgent Need

The EU estimates Ukraine will need an additional €135 billion over the next two years, with liquidity issues expected to start in April 2026.

Speaking in Brussels on Thursday, President Volodymyr Zelensky emphasized the importance of using frozen Russian assets before year-end. “These assets must be used to defend against Russian aggression and rebuild what Russian attacks have destroyed. It is ethical, fair, and legal,” he said. Zelensky had previously warned that failing to secure an agreement on these assets could leave Ukraine facing serious financial problems.

While Kyiv may be disappointed that frozen Russian assets will not be tapped, the secured EU funding provides a measure of relief. Zelensky noted that having stronger financial footing could enhance Ukraine’s leverage in peace negotiations.

U.S. and EU Diplomatic Efforts

Alongside EU discussions, the U.S. has been leading efforts to negotiate an end to the war, although Europe has been largely sidelined in these talks. French President Emmanuel Macron said the time has come for European engagement with Moscow. “In the coming weeks, we must find ways for Europeans to re-engage in a full and transparent dialogue with Russia,” he said.

Zelensky announced that Ukrainian and U.S. delegations will hold new talks in the United States on Friday and Saturday. He also urged Washington to provide more details on security guarantees for Ukraine, asking specifically how the U.S. would respond if Russia launched a new attack.

Meanwhile, Trump continued to pressure Kyiv, reiterating his hope that Ukraine would “move quickly” to reach an agreement.

Zelensky Thanks EU for Support

On Friday, Zelensky took to X to thank the EU for the loan, saying it “truly strengthens our resilience.” He stressed the importance of keeping Russian assets immobilized and securing financial guarantees for Ukraine in the coming years.

“This is significant support that truly strengthens our resilience,” he wrote.