EU leaders reached an agreement on Friday to provide Ukraine with a 90-billion-euro loan. This funding aims to address Kyiv's impending budget shortfalls. The deal emerged from summit talks in Brussels, where leaders chose to back the loan with the bloc's common budget for the next two years.

Officials scrapped an initial plan to use approximately 200 billion euros in frozen Russian central bank assets, held mostly in Belgium. Belgium demanded liability-sharing guarantees that other countries found unacceptable, leading to the alternative approach. European Council head Antonio Costa stated the decision would equip Ukraine to defend itself and support its people.

Implications for Ukraine's Financial Stability

The EU Ukraine loan comes as Ukraine requires an estimated 135 billion euros to remain solvent over the next two years, with a cash crunch expected to begin in April. This support arrives amid US President Donald Trump's push for a swift resolution to Russia's nearly four-year war. Ukraine's President Volodymyr Zelensky had advocated for tapping Russian assets, describing it as "moral, fair, and legal" during the summit.

Without the asset option, the loan still offers relief and could strengthen Kyiv's position in potential talks. European Commission president Ursula von der Leyen noted that Ukraine would repay the loan only after Moscow compensates for damages caused. Hungary, Slovakia, and the Czech Republic received exemptions from the joint debt commitment to secure unanimous approval.

Reactions from Key Figures

Belgian Prime Minister Bart De Wever expressed relief, calling the asset plan "risky" and "dangerous" like a sinking ship. German Chancellor Friedrich Merz, who favored the asset approach, said the loan sends a clear signal to Russian President Vladimir Putin. French President Emmanuel Macron urged Europeans to engage directly with Moscow in coming weeks for a framework to discuss the conflict. Zelensky announced new talks between Ukrainian and US delegations on Friday and Saturday to clarify security guarantees against future Russian aggression. No immediate response came from Russian officials as the summit concluded.