EU agrees €90bn loan for Ukraine
What's the story
European Union (EU) leaders have approved a €90 billion ($96 billion) loan for Ukraine. The financial package is intended to help Kyiv address its budget shortfalls through 2026-27. However, the proposal to use frozen Russian assets to fund this loan was not agreed upon by all member states. The decision came after lengthy negotiations at a summit in Brussels amid US President Donald Trump pushes for a quick deal to end Russia's war.
Funding disagreement
Frozen Russian assets proposal fails to gain consensus
Initially, EU leaders considered tapping into around €200 billion of Russian central bank assets frozen in the EU. However, Belgium's insistence on guarantees for sharing liability led to the proposal being dropped. German Chancellor Friedrich Merz had strongly advocated for this plan but acknowledged that the final decision on the loan "sends a clear signal" to Russian President Vladimir Putin.
Financial relief
EU loan aims to address Ukraine's financial needs
The EU estimates that Ukraine will need an additional €135 billion ($159 billion) over the next two years, with a cash crunch expected to begin in April. It has been suggested that Ukraine would only need to repay the loan once Moscow pays for damages caused by its war. Ukrainian President Volodymyr Zelenskyy had earlier pushed for using frozen Russian assets to fund the loan, calling it "moral," "fair," and "legal."
Peace negotiations
US efforts to broker peace in Ukraine-Russia conflict
Meanwhile, Ukrainian and US delegations are set to hold talks in the United States over the weekend. Zelensky has asked Washington for more details on security guarantees it could offer against further Russian aggression. "What will the United States of America do if Russia comes again with aggression?" he asked. "What will these security guarantees do? How will they work?"