The European Union will probably have to provide a new loan to Ukraine to cover its budget shortfall and support its defense against a Russian invasion. This was stated by Estonian Prime Minister Kristen Michal in an interview with Reuters before the second day of the EU summit in Brussels, BTA reports.
“European financial assistance must be available“, Michal said. “In a war of attrition, financial assistance is the alpha and omega. It must not stop and it must come from the EU,” he added.
In December last year, European leaders agreed on a €90 billion loan intended to cover much of Kiev’s financial needs in 2026 and 2027. However, Ukraine now says it will still lack €70 billion for defense and regular budget spending next year.
Some European governments are insisting that the funds be secured through Russian assets frozen in the EU. However, this idea is met with resistance from Belgium, where most of the assets are stored, as well as from several other countries.
According to Michal, a new EU loan remains the most likely option. “This is a mechanism that Europe has used many times, so for Europe it is a fairly well-known mechanism,” he said. The Estonian prime minister hopes that the decision on additional funding for 2027 will be made before the end of this year, as elections are due in a number of European countries next year.
The EU is mobilising funds from its general budget to finance the current €90 billion loan. Asked how the new loan will be financed, Michal replied: “We will find a way, because Europe usually finds a way. You reach the most difficult moment and then you find a way“.