Ukraine war
New EU loan for Ukraine is primarily intended to strengthen the military
Updated on January 14, 2026 – 12:42 p.mReading time: 2 minutes
Ukraine urgently needs money for the military and budget. A loan is to come from the EU – which doesn’t look quite like what Chancellor Merz initially wanted.
According to the European Commission’s wishes, the new huge EU loan for Ukraine should largely benefit the armed forces fighting against Russia. According to a proposal presented by Commission President Ursula von der Leyen, the Ukrainian military should be supported with 60 billion euros.
According to the Brussels authority’s proposal, the remaining 30 billion euros of the total 90 billion euros loan should be made available to Ukraine as budget support.
The support will ensure that Ukraine can, on the one hand, strengthen its defense on the battlefield and expand its military capabilities and, on the other hand, maintain the state and basic public services, said von der Leyen.
The EU Commission’s specific proposal was preceded by an agreement between the heads of state and government of the member states on financing Ukraine for the next two years. At a summit shortly before Christmas, after months of argument, they agreed on a compromise to give Ukraine an interest-free loan of 90 billion euros. The agreement also stipulates that Russian assets frozen in the EU will be used for repayment if Moscow does not pay compensation for war damage.
A financing model had previously been discussed, according to which funds from the Russian central bank, primarily in Belgium, would be used directly for loans to Ukraine worth up to 210 billion euros. Chancellor Friedrich Merz in particular was an advocate of this project. This plan ultimately failed due to resistance from countries such as France and Italy, after Belgium in particular had previously seen the legal and political risks as being too great.
