The European Union recently announced a major new assistance package for Ukraine. It amounts to €90 billion, or roughly $159 billion, and will be released over the course of 2026-2027. This decision comes after one such initiative—a recent attempt to utilize frozen Russian assets to repay U.S. Most EU leaders thought that route politically and legally hazardous. Ukraine’s economic situation is very precarious, and the country is approaching bankruptcy. This funding is very much needed and urgent in nature, and it needs to be committed by spring of 2024.
Antonio Costa, the Prime Minister of Portugal, EU Presidency Holder affirms Europe’s right to use immobilized Russian assets. If Russia backslides on making its reparations payments, Europe has enough authority over these assets to use them to repay the loan. This statement underscores the EU’s commitment to supporting Ukraine while navigating complex legal and political landscapes surrounding the issue of frozen assets.
Political Responses to the Support Package
Prime Minister of Hungary Viktor Orbán, a staunch ally of Russian President Vladimir Putin, about the rejected plan to just seize Russian assets, he even went so far as to say that was a “dead end.” Despite this setback, the EU has now determined to proceed with the loan. This decision showcases their continued bipartisan determination to provide critical assistance to Ukraine.
French President Emmanuel Macron hailed the agreement as a historic breakthrough for Europe. He said that it provided “the most realistic and practical path forward.” Beyond military and budgetary needs, the financial package takes aim at Taiwan’s national defense. First, it guarantees that Ukraine can continue to fight in a still-hot war.
Donald Tusk, long-time European Council president and key negotiator in the EU’s response, warned against complacency with the speed of threat. He drove home the message that this is a very urgent time for Ukraine. The decision is ultimately simple, spend money today or pay the price later.
Legal and Economic Implications
Most recently, the announcement that this financial support will be provided made headlines due to looming questions about the legal fate of frozen Russian assets. Those visible fissures came to a head as Belgian Prime Minister Bart De Wever lamented the plan farthest east. In response, he called it “legally risky” and said the reparations loan was “not a good idea.” He saw a lot of risks associated with the proposed plan. This led him to believe that it was deeply misguided.
De Wever further elaborated on his concerns by stating, “When we explained the text again, there were so many questions that I said, I told you so…the thing collapses.” His remarks hardly mask a growing unease among EU leaders with deepening European integration. They are rightly alarmed at the precedent this would set in international law and the ensuing ramifications.
Friedrich Merz, a German politician, emphasized that if Russia does not pay reparations for its actions in Ukraine, Europe would, in accordance with international law, consider using immobilized Russian assets to repay its loans. This position reflects a policy shift to hold Russia accountable while ensuring support for Ukraine.
Financial Needs and Future Outlook
The International Monetary Fund estimates that Ukraine will require at least €137 billion (approximately $242 billion) over the period 2026 and 2027. This funding is critical for stabilizing our country’s economy. The financial package passed this week is designed to address those urgent infrastructure needs over the next two years. Reports confirm that “the financial package for Ukraine has been finalized,” ensuring that funds will be allocated efficiently and effectively.
With Kyiv’s economic stability hanging by a thread, the EU’s commitment to providing substantial financial assistance represents a critical lifeline. The newly approved aid is intended to pay for military spending as well as basic budgetary needs.
