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The European Union has approved a substantial new financial support package for Ukraine, committing more than $105 billion in aid for 2026 and 2027. The agreement underscores the bloc’s continued political and economic backing of Kyiv as the war with Russia enters its fourth year, while also highlighting internal EU caution over legal and financial risks tied to frozen Russian assets.

EU Council President Antonio Costa confirmed the deal on Friday, stating that member states had reached consensus after months of negotiations. The funding will be raised through joint EU borrowing backed by the bloc’s budget rather than by seizing Russian assets held within the Union.

Size and Structure of the Aid Package

Under the agreement, EU countries will allocate approximately €90 billion, equivalent to $105.5 billion, over the two year period. The funds will be distributed through the Ukraine Facility and related EU programs, providing Kyiv with predictable medium term financing to cover budget deficits, reconstruction needs, and essential government services.

The package builds on earlier assistance mechanisms that have already delivered billions of euros to Ukraine in grants and loans. EU officials emphasized that the new commitment is designed to provide financial stability beyond short term emergency funding and to reassure markets and international partners of Europe’s long term support.

Debate Over Frozen Russian Assets

A central point of contention during negotiations was whether to use roughly €210 billion in frozen Russian sovereign assets to finance a reparations style loan for Ukraine. Most of these assets are held in Belgium, placing the country at the center of the legal and political debate.

Belgian Prime Minister Bart De Wever publicly expressed concern over potential litigation risks and the lack of clear legal safeguards, stating that concrete guarantees were required before approving any move to deploy the assets. Similar concerns were echoed by other EU governments wary of setting a precedent that could expose the bloc to legal challenges or undermine confidence in European financial markets.

Ultimately, EU leaders decided not to tap the frozen assets directly. Instead, they opted for joint borrowing, a mechanism previously used during the COVID 19 recovery, backed collectively by the EU budget.

Position of Ukraine and EU Leadership

Ukrainian President Volodymyr Zelenskyy had urged EU leaders earlier this week to increase support and to take decisive action on Russian assets, arguing that sustained financial backing is essential to maintain resilience and deter further Russian advances in the coming year.

Responding to those concerns, Costa stressed that the new funding would ensure continuity of support while keeping pressure on Russia. He stated that Ukraine would only be expected to repay the EU loans once Russia pays reparations, reiterating that a ceasefire and negotiated peace remain the ultimate objective.

EU officials also emphasized that political and financial support for Ukraine would not weaken, even as discussions continue around potential peace frameworks.

Previous and Ongoing Financial Support

Since Russia’s full scale invasion in 2022, total EU support to Ukraine has exceeded €187 billion, according to EU estimates. This includes military assistance, macro financial aid, humanitarian support, and refugee related spending within EU member states.

Earlier this year, the EU delivered around €6 billion in bridge financing to help Ukraine meet urgent budgetary needs. In addition, Ukraine has received €18.1 billion in loans in 2025 under a G7 led initiative, further bolstering its fiscal position amid ongoing conflict.

Broader Geopolitical Context

The new EU funding package also reflects Europe’s desire to play a stronger role in shaping diplomatic efforts to end the war. The financial backstop comes as U.S. and Ukrainian officials have held talks aimed at refining a peace framework and narrowing differences over proposals to halt the conflict.

According to reports, those discussions have included sensitive issues such as territorial control, security guarantees, and Ukraine’s future relationship with NATO. Some elements of the proposed framework have been difficult for Kyiv to accept, particularly provisions that could freeze current front lines or limit future military options.

By locking in long term financial support, EU leaders aim to strengthen Ukraine’s negotiating position while signaling unity and resolve to both allies and adversaries.

What This Means Going Forward

The approval of more than $105 billion in new funding provides Ukraine with greater certainty at a critical stage of the conflict. For the European Union, the decision balances solidarity with legal and financial prudence, avoiding immediate risks tied to frozen assets while maintaining pressure on Russia through sustained economic support.

As the war continues and diplomatic efforts evolve, the package positions the EU as a central financial pillar in Ukraine’s survival, recovery, and eventual reconstruction.