The European Union will provide Ukraine with a loan of up to €35 billion ($39 billion) to support the country as it continues to grapple with the ongoing war against Russia. This announcement was made by EU Commission President Ursula von der Leyen during her visit to Kyiv on Friday.
The funding is part of a broader initiative among G7 nations to utilize proceeds from Russian assets that have been frozen as a result of sanctions imposed after Moscow’s invasion of Ukraine. Von der Leyen emphasized the urgent need for continued EU support, stating, “Relentless Russian attacks mean Ukraine needs continued EU support,” in a post on X (formerly Twitter).
Ukraine is facing significant financial challenges following more than two years of warfare that have severely damaged its infrastructure, particularly its energy systems, which have lost approximately 9 gigawatts (GW) of capacity due to Russian strikes.
In response to the conflict, the G7 nations have frozen about $300 billion in Russian financial assets and committed to using these funds to assist Ukraine. After extensive discussions, the EU reached an agreement in May to allocate 90% of the proceeds from these frozen assets to an EU-run fund designated for military aid, while the remaining 10% will support Ukraine in other capacities.
These frozen assets are generating substantial interest, leading to so-called windfall profits. According to EU diplomats, Ukraine is expected to receive the first tranche of this financial support in July. This loan aims to bolster Ukraine’s financial stability as it continues to defend against ongoing aggression from Russia.
