What's happened
EU leaders reached an agreement to provide Ukraine with a €90 billion support package for 2026-27, opting to borrow on capital markets backed by the EU budget rather than using frozen Russian assets. Ukraine's government sees this as vital for its war effort and economic stability amid ongoing negotiations.
What's behind the headline?
Strategic Shift in EU Support
The EU's decision to avoid using Russian assets marks a significant shift, prioritizing legal clarity and political stability over the contentious asset seizure plan. This move underscores the complexity of freezing and potentially using foreign assets in conflict support, highlighting the EU's preference for safer, more sustainable funding mechanisms.
Implications for Ukraine
By securing €90 billion through market borrowing, Ukraine gains a crucial financial lifeline, enabling it to sustain military and economic operations. This approach also signals a cautious but firm stance by the EU, balancing support with legal prudence.
Broader Geopolitical Context
The decision reflects broader tensions between EU member states over how to handle Russian assets and support Ukraine. While some nations favored direct asset use, concerns over legal repercussions and liabilities prevailed, illustrating the delicate balance of power and interests within the EU.
Future Outlook
The EU's reliance on market borrowing may set a precedent for future conflict-related funding, emphasizing transparency and legal safeguards. Meanwhile, Ukraine's negotiations with the US and ongoing peace efforts will influence the next phase of support and conflict resolution.
What the papers say
The New York Times reports that EU leaders opted for borrowing on capital markets, citing legal and liability concerns over using Russian assets. France 24 highlights the political debate, noting that some countries, like Belgium, demanded guarantees before supporting asset seizure plans. Al Jazeera emphasizes the importance of the €90 billion support package, describing it as a vital lifeline for Ukraine. The contrasting perspectives reveal a tension between legal caution and urgent support needs, with some officials viewing the asset plan as too risky and others seeing it as morally justified. Overall, the consensus favors a safer, more sustainable funding route, though debates over the use of Russian assets continue behind closed doors.
How we got here
Since Russia's invasion of Ukraine, the country has faced severe economic and military challenges. The EU has sought ways to support Kyiv, initially considering using frozen Russian assets as collateral for loans. However, legal and political hurdles, including Belgium's opposition and concerns over liabilities, led to the decision to borrow via capital markets instead. Ukraine's need for financial aid remains urgent as it prepares for a prolonged conflict.
Go deeper
Common question
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What Does the EU's €90 Billion Support for Ukraine Mean?
The European Union has announced a €90 billion support package for Ukraine, aimed at bolstering the country's economy and military efforts amid ongoing conflict. But what does this funding really entail, and why did the EU choose this route instead of using Russian assets? Here, we explore the implications of this support, its political significance, and what it means for Ukraine's future.
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The European Union is a political and economic union of 27 member states that are located primarily in Europe. Its members have a combined area of 4,233,255.3 km² and an estimated total population of about 447 million.
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Ukraine is a country in Eastern Europe. It is the second-largest European country after Russia, which borders it to the east and northeast.
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Ursula Gertrud von der Leyen is a German politician and the president of the European Commission since 1 December 2019. She served in the federal government of Germany from 2005 to 2019 as the longest-serving member of Angela Merkel's cabinet.
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Vladimir Vladimirovich Putin is a Russian politician and former intelligence officer who has served as President of Russia since 2012, previously holding the position from 1999 until 2008.