Ukraine and the European Union (EU) have agreed to expedite the payment of a €45 billion loan under the Ukraine Support Program in 2027. This decision follows an increase in Russian air and missile attacks on Ukraine and the country's financial resource shortages for purchasing defensive weapons.
Ukraine's Financial Resource Shortages
Captain Serhiy Kurtsky, the Prime Minister of Ukraine, warned reporters this week that Ukraine is facing a $27 billion (€23 billion) shortfall in defense financing this year. Kyiv hopes to secure about $7 billion through domestic sources and will turn to its partners for the remainder. Volodymyr Zelensky, the President of Ukraine, also stated that if this shortfall is not addressed in the next two months, Kyiv may not be able to purchase the necessary weapons early next year.
Agreement to Accelerate Loan Payment
At a recent meeting of EU defense ministers, many members called for the prepayment of parts of the €90 billion loan allocated for 2027. However, the European Commission preferred to accelerate the payment of the 2027 loan next year, meaning Ukraine will receive this amount faster. Zelensky said, "Our dialogue with the European Commission has brought good results in response to Ukraine's financial and defense needs for 2026 and 2027."
The two sides also agreed to start working on identifying additional budgetary and defense needs and to meet monthly to coordinate their efforts. The €90 billion loan agreed upon by EU leaders last December includes strict conditions for Kyiv, including adherence to the rule of law and fighting corruption. A significant portion of this loan — €60 billion — is allocated for Ukraine's defense needs.
This loan is evenly divided, with €45 billion for 2026 and another €45 billion for 2027. The program is designed to cover two-thirds of Ukraine's external financial needs over these two years, while the remainder is expected to be secured through other countries, especially G7 partners.
All parties agreed that other partners must also fulfill their financial commitments and increase their efforts in light of the significant challenges Ukraine is facing.
