The day after the lifting of the Hungarian veto, the Council of the European Union officially adopted the EU’s €90 billion Ukraine support loan for 2026 and 2027, on Thursday 23 April, just in time for the opening of the EU summit in Nicosia.
On his arrival in Cyprus for the extraordinary European summit, the President of the European Council, António Costa, welcomed the fact that the EU had taken “two important steps” to strengthen Ukraine, namely the release of the €90 billion loan and “increasing the pressure on Russia” with a new package of sanctions (see EUROPE 13845/1).
“Now it’s time to prepare the next step, that is to open formally the first clusters of the EU accession negotiations of Ukraine”, he stated.
“In February, I said we would deliver on the loan one way or the other. Today, we deliver!”, said a delighted President of the European Commission, Ursula von der Leyen. “The first package will be drones from Ukraine, to Ukraine”, she said.
The Ukrainian President, Volodymyr Zelensky, promised that his country will do everything possible to ensure that these funds are disbursed quickly, with the second quarter remaining the target for European leaders. EU aid will “strengthen Ukrainian forces, boost production to protect our energy system, and push Russia for real negotiations”, he stressed.
In concrete terms, Member States unanimously adopted the last of the three legislative texts formalising the loan to Ukraine, namely the proposal amending the EU budget to authorise the European Commission to borrow on the markets. The other texts concern the implementation of enhanced cooperation with 24 Member States and the modification of the “Ukraine Facility”, a financial instrument used to provide funds to Kyiv and help it move closer to EU standards.
Hungary, Slovakia and the Czech Republic will not be participating in the financing of the loan. They will not bear the interest (€1 billion in 2026 and €3 billion each year, according to estimates made in late 2025) in proportion to their contribution to the EU budget, nor the consequences in the event of a repayment default.
Under the terms of the agreement, Ukraine will reimburse the EU using the war reparations paid by Russia. If Moscow fails to pay, the Commission will call on the 24 EU countries participating in the loan. The EU also reserves the right to mobilise Russian public assets immobilised in the EU, in accordance with the EU Council decision taken in late 2025 (see EUROPE 13771/7). Such a decision will require a new decision by the European Council.
Of the total package, €60 billion will enable Ukraine to purchase military equipment and €30 billion will be used for budgetary support.
For 2026, the EU wants to provide €45 billion, including €28.3 billion for defence and €16.7 billion for budgetary support (€8.35 billion via the ‘Ukraine Facility’ and €8.35 billion via the ‘Macrofinancial Assistance’ or ‘MFA’ instrument). An initial payment is expected in the second half of this year through the ‘MFA’ instrument.
This division of budget support into two equal parts of €8.35 billion is valid for 2026 and could therefore change for 2027. Both the ‘Ukraine Facility’ and the ‘MFA’ make the disbursement of European funds subject to conditions relating to the management of public finances and the fight against corruption and money laundering.
In particular, as it did during the financial rescue of Greece, the EU is granting itself a right of scrutiny over financial movements by setting up a joint bank account with Ukraine to monitor Ukrainian spending.
In addition to Ukraine’s financing strategy for 2026 (see EUROPE 13841/10), other technical documents must be agreed with the Ukrainian authorities before the initial payments can be made. A Memorandum of Understanding (MoU), which was sent to Kyiv last week, will amend the ‘MFA’ instrument. The ‘Ukraine Facility’ also needs to be updated to incorporate new investments and reforms.
In addition, the EU and Ukraine have yet to finalise Ukraine’s defence procurement plan for 2026. This plan has already been the subject of a waiver authorising Ukraine to procure drones from third countries due to the urgency of the war (see EUROPE 13841/10).
See the joint statement by the Presidents of the European Council, of the European Commission and of Ukraine: https://aeur.eu/f/lnz (Original version in French by Mathieu Bion)