EU Commission proposes €45 billion loan for Ukraine to bolster 2026 defense

The European Commission on Thursday proposed a €45 billion loan installment for Ukraine for 2026, marking a significant step in the mobilization of a previously negotiated €90 billion total support package. Alongside the funding proposal, Brussels has commenced preparations for the initial procurement of defense systems—prioritizing attack and reconnaissance drones.

According to a press release issued by the Commission, the proposal submitted to the EU Council seeks formal ratification of the total support volume for 2026. It further includes a directive authorizing a specialized procurement procedure for the first batch of military hardware to be sourced through the Ukraine Support Loan facility.

Brussels prepares to finance Ukraine’s drone industry directly

European Commission President Ursula von der Leyen stated that Brussels will “deliver on its €90 billion loan commitment.” She noted that steps have already been taken to mobilize resources this year to finance military equipment acquisitions, with a strategic focus on “Ukraine’s advanced drone industry.”

According to von der Leyen, the move serves as a signal on the fourth anniversary of the Bucha events that the Commission is “ready to move forward” and remains steadfast in its support for Ukraine’s “struggle for freedom.”

Under the European Commission’s proposal, €45 billion is slated for disbursement by December 31, 2026. The remainder of the €90 billion comprehensive package is scheduled for 2027.

Following approval by the EU Council, the Commission aims to execute the first tranche as swiftly as possible. This funding is designed to complement contributions from other international donors and address Kyiv’s projected external financing requirements, including defense expenditures.

Financing to be divided between budget support and military capacity

The structure of the proposed support divides resources between budgetary assistance and defense industrial financing. Up to €16.7 billion is earmarked for general budget needs, while €28.3 billion is allocated specifically to bolster Ukraine’s defense industrial potential.

On March 20, Ursula von der Leyen affirmed that the European Union would provide the €90 billion in financing “one way or another,” despite the package being blocked by Hungary.

“The money is blocked because one leader [Hungarian Prime Minister Viktor Orban] is not keeping his word, but we will get this money to Ukraine one way or the other,” von der Leyen said.

Orban had previously halted the implementation of the €90 billion decision in January 2026, citing a dispute regarding the damaged Druzhba oil pipeline.

While Kyiv maintains that repairs to the infrastructure will take time, Budapest contends that the pipeline is ready for operation. Meanwhile, Moscow continues to condemn military aid to Ukraine. The Kremlin has repeatedly stated that such assistance will not alter the course or the objectives of its special military operation.