EU and Ukraine identify funds to cover budget and defence for 2026; 45 billion euros for 2027

The European Commission and Ukraine announced on Thursday that they have identified the funds to cover Ukraine’s budgetary and defence needs for 2026, and agreed to quickly unlock more money for 2027, as Reuters reports.

The joint statement says: “Today, through joint coordinated efforts, we have identified the means to cover Ukraine’s budgetary and defence needs for 2026. We have also reconfirmed the necessary steps to ensure their timely release.”

Ukraine relies heavily on payments from the EU’s 90-billion-euro loan for this year and next. Kyiv is struggling to close a $27 billion financing gap to secure war operations in early 2027 — Prime Minister Sergii Koretskyi said on Wednesday that the cost of the war this year will reach $155 billion.

Thursday’s statement suggests Ukraine must meet EU reform policy benchmarks in order to access all the money. The two sides agreed “to move swiftly forward with the allocation of 45 billion euros” from the EU loan for 2027, “in line with the conditions set out”.

Background: Bloomberg earlier reported that the EU had rejected Ukraine’s request to speed up loan payments to cover the unexpected shortfall, citing sources familiar with the matter; but an EU official familiar with the talks denied that interpretation: “We have not closed any door.” The official added: “Today we had a very productive meeting that ended with a clear path forward that secures the necessary means for 2026 and the start of joint work for 2027.”

Volodymyr Zelensky and Ursula von der Leyen at a joint press conference at the European Commission. (Photo: European Union / Wikimedia Commons, CC BY 4.0 licence)