EU Reaches Loan Agreement for Ukraine Amid Stalled Russian Asset Utilization Plan

European Union leaders agreed on Friday to extend a loan of 90 billion euros ($105 billion) to Ukraine in order to stabilize the finances of the war-affected nation. However, they could not achieve consensus on a more ambitious initiative to utilize frozen Russian assets for additional support.

This agreement, solidified after lengthy discussions during a summit in Brussels, provides a crucial financial support system for Kyiv amid pressures from U.S. President Trump for a swift conclusion to Russia’s nearly four-year conflict with Ukraine.

“Today’s decision will equip Ukraine with the necessary resources to defend itself and aid its people,” stated European Council President Antonio Costa.

Ukrainian President Volodymyr Zelensky took to X to express that this agreement represents significant support that enhances their resilience, noting, “It is vital that Russian assets remain frozen and that Ukraine has secured a financial guarantee for the upcoming years.”

Moscow officials responded positively to this development. Kirill Dmitriev, the Kremlin’s chief economic negotiator, shared on Telegram that the EU had not been able to «illegitimately utilize Russian assets to fund Ukrainian interests,» claiming that “for now, law and common sense have triumphed.”

The loan, which is underpinned by the EU’s collective budget and spans the next two years, does not align with proposals to access around 200 billion euros in Russian Central Bank assets that are being held within the EU.

This option hit a snag when Belgium, where the majority of the assets are stored, sought assurances on how any potential legal and financial implications would be managed, a condition that other member states were hesitant to meet.

At the close of the summit, Belgian Prime Minister Bart De Wever informed reporters that he believed «rationality has prevailed.»

“This entire matter was fraught with risks, dangers, and many uncertainties. It felt like a sinking ship, much like the Titanic. The die is cast, and there is a collective sense of relief,” De Wever remarked.

German Chancellor Friedrich Merz, who had advocated forcefully for the asset sequestration plan, mentioned that the final outcome reached early Friday still conveys a strong message to Russian President Vladimir Putin.

European officials clarified that Ukraine will not need to repay the loan until Russia agrees to provide compensation for war-related damages. Nations skeptical of aid to Ukraine, such as Hungary, Slovakia, and the Czech Republic, were granted exemptions to ensure unanimous approval.

The EU anticipates that Ukraine will require an additional 135 billion euros ($159 billion) over the following two years, with funding challenges expected to escalate in the spring.