A majority of Member States are said to have expressed an interest in continuing work on a new loan to compensate Ukraine for the destruction caused by Russian military aggression (see EUROPE 13713/2), at a meeting of Member States’ ambassadors to the European Union (Coreper) on Friday 26 September.
During this discussion, the European Commission presented Member States with a short written document outlining the initiative announced by its President, Ursula von der Leyen, at the beginning of September (see EUROPE 13706/2). The financial package could amount to €140 billion to cover Ukraine’s financial needs for at least 2026 and 2027. This figure was also mentioned by the German Chancellor, Friedrich Merz (see EUROPE 13718/17).
Many questions remain unanswered before the Commission presents its proposal, the scale of which will also depend on Ukraine’s financing requirements. The IMF is due to deliver its assessment in the next few days. Furthermore, the way in which the loan will be guaranteed - first bilaterally on the basis of national budgets and then by the EU27 via the EU budget - is an open question. Other questions include: who will manage future bonds issued to replace cash balances from maturing Russian public assets? Will the G7 partner countries respond to the initiative?
Benefits for the European military industry. The implications for the European military industry of the future loan through equipment purchases by Ukraine are also part of the discussion.
This loan “will ensure that Ukraine has access to a steady flow of superior equipment and weapons predominantly from European and own defence industry”, says the European Commission in its framework document, which will feed into the discussions at the extraordinary European summit in Copenhagen on Wednesday 1 October (see other news).
On Monday 29 September, a French presidential source (from the Élysée palace) set out several “essential conditions” inherent in the future EU loan: “no confiscation of Russian public assets”, the spreading of risks through the provision of guarantees, “the continuation of reforms in Ukraine and the link with the EU’s industrial base”.
Discussions will continue at a remote ‘G7 Finance’ meeting on Wednesday. The Presidency of the Council of the EU has put this issue on the agenda for the meeting of European finance ministers in Luxembourg on Friday 10 October. (Original version in French by Mathieu Bion)