EU to loan Ukraine $106 bn, decision on using frozen Russian assets deferred – Firstpost

The European Union has reached an agreement to provide a loan of $106 billion to Ukraine to help the country catch up on its budget shortfall. However, the decision to use Russian frozen assets has been put on hold for now.

The agreement – which came after more than a day of talks at a summit in Brussels – offers Kyiv a desperately needed lifeline as US President Donald Trump pushes for a quick deal to end Russia’s war.

“We have a deal. Decision to provide 90 billion euros of support to Ukraine for 2026-27 approved,” EU chief Antonio Costa wrote on X. “We committed, we delivered.”

Why are Russian assets not used?

While the priority had been to get a consensus on using some 200 billion euros of Russian central bank assets frozen in the EU to generate a loan for Kyiv, the scheme fell through after Belgium showed resistance.

Belgium holds the vast majority of the Russian assets, and the country demanded guarantees on sharing liability that proved too much for other countries.

German Chancellor Friedrich Merz had pushed hard for the asset plan – but still said the final decision on the loan “sends a clear signal” to Russian President Vladimir Putin.

How much funding does Ukraine need?

The EU estimates Ukraine needs an extra 135 billion euros ($159 billion) to stay afloat over the next two years, with the cash crunch set to start in April.

Ukraine’s President Volodymyr Zelensky had told EU leaders at the start of the summit on Thursday that using Russian assets was the right way to go.

“Russian assets must be used to defend against Russian aggression and rebuild what was destroyed by Russian attacks. It’s moral. It’s fair. It’s legal,” Zelensky said.

While Kyiv may be left disappointed that the EU did not take the leap to use the Russian assets – securing financing another way will still be a relief.

With inputs from AFP