The EU countries have now agreed on the conditions for the 90 billion euro loan for Ukraine approved in December 2025. Of the 90 billion euros, 60 billion are intended for military spending. Kiev should “in principle” use this money for military equipment from Ukraine, EU states or non-EU countries in the European internal market, as the Council of EU countries announced on Wednesday. But there are several exceptions.
At the summit in December, the EU heads of state and government agreed on the interest-free loan for the years 2026 and 2027. A third of the money will go directly to Kiev as budget aid, the rest will be earmarked for military spending in the fight against Russia. The EU raises the money on the capital market, with the EU budget serving as security. There was disagreement among member states over how and where Ukraine could spend the money.
Exceptions depending on urgency
The cascade principle that has now been adopted stipulates that purchases should first be made on the European market. However, if Kiev “urgently” needs weapons that are not available in Europe or are not available quickly enough, “a series of targeted exceptions would apply,” according to the EU Council. This would allow Ukraine, for example, to purchase Patriot air defense systems and parts from the USA.
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The agreement also stipulates that countries outside the European internal market can be given preference if they participate in the EU’s billion-dollar defense fund Safe or are prepared to “make a fair and appropriate financial contribution to the costs arising from borrowing.” British defense companies in particular could move further up the priority list.
First payment to Kyiv in April
Talks about a British stake in Safe collapsed in November. What exactly such a contribution to the credit costs could look like will be clarified in new negotiations. The final legal text for the Ukraine loan still needs to be agreed with the EU Parliament. The first payment to Kyiv is planned for the beginning of April.
