The issue came to the forefront on Monday at a meeting of the “coalition of the willing” in Kyiv, held to mark Ukraine’s 35th anniversary of independence.
President Volodymyr Zelenskyy stated that the Ministry of Defense is facing a funding shortfall of 23.1 billion euros, which must be covered to continue military operations.
As experts explain, the “shortfall” did not result from unforeseen expenses. Ukraine carried over to the first half of the year funds originally planned for the second half. These 23 billion euros are needed for personnel payments, social support, and weapons procurement, including 6 billion euros in advance payments for deliveries scheduled for early 2027.
According to Zelenskyy, closing this gap is vital for Ukraine to remain “competitive in terms of the number of deep strikes” against Russia, thereby increasing pressure on President Putin to agree to substantive peace talks.
His proposed solution is for the EU to bring forward a portion of the €90 billion loan. Brussels has divided this loan into two parts of €45 billion each for 2026 and 2027, respectively. According to Zelenskyy’s proposal, part of the funding earmarked for next year could be brought forward to this year.
The European Commission’s initial reaction was cautious
“We are ready to accommodate requests to the greatest extent possible, but for now we are proceeding based on the plan that has already been adopted,” Euronews quoted its representatives as saying.
To date, Brussels has transferred 3.2 billion euros in budgetary aid and 8.35 billion euros in military aid. A total of 22 billion euros has been allocated for the procurement of weapons, such as fighter jets and drones. These funds will become available only after the defense contracts submitted by Kyiv have been reviewed; the process may be delayed due to errors and last-minute changes. Another 6 billion euros remain unallocated.
Nearly 14 billion euros in budgetary support also remains in limbo, with some of the payments contingent on the implementation of reforms.
In recent months, the Ukrainian parliament has slowed the approval of key bills, raising concerns in Brussels. The Commission states that it is ready to accelerate the disbursement of funds this year, but within the 45-billion-euro ceiling.
When Money Meets Politics
Off the record, EU officials doubt that bringing forward the loan disbursement is feasible or advisable. Changing the schedule would require legal amendments to the original plan and would force the European Commission to adjust its borrowing plans.
It would also entail serious political risks. The leaders of the 27 EU countries agreed to the emergency loan on the understanding that it would provide stable funding for 2026 and 2027, until the Union’s next seven-year budget takes effect in 2028.
Bringing forward part of the funding earmarked for 2027 could leave Ukraine with a new budget shortfall later that same year—without an immediate replacement for those funds. There is no indication that Kyiv’s needs will decrease next year, given the escalating attacks from Moscow.
Many consider it politically unrealistic to persuade EU leaders to approve a new credit line in 2027, when a series of high-stakes elections is expected. An alternative could be more active participation by other Western allies in covering Ukraine’s deficit.
But EU officials complain that, with the exception of the United Kingdom and Norway, other allies have contributed far less than expected. Support from the U.S., previously one of the largest donors, has essentially ceased.
Frozen Assets of the Central Bank of Russia
A more ambitious option, which Zelenskyy raised at Monday’s meeting of the “Coalition of the Resolute,” is to use the frozen assets of the Russian Central Bank. The EU holds approximately 210 billion euros in Russian assets, most of which are in Belgium.
Initially, the European Commission viewed these assets as Plan A for financing Ukraine in 2026–2027. But opposition led by Belgium derailed this plan last December. As a result, the 27 leaders moved on to Plan B—joint borrowing to secure a 90 billion euro loan for Ukraine.
Despite the failure of Plan A, some member states remain convinced that Russian assets are the ultimate solution and are preparing to revive the idea.
“We must agree to use frozen Russian assets to pay this bill,” Latvian Prime Minister Andris Kulbergs said Monday while speaking alongside Zelenskyy. “Why should European citizens have to pay it in full? This is Russia’s bill.”
Opponents, however, remain firmly opposed to using these assets. Belgium continues to demand large-scale solidarity measures as a condition for any steps in this direction, while Euroclear, a Belgium-based financial company holding most of the assets, is facing lawsuits from Russia.
“Judging by what happened last year, I don’t see any desire right now to revisit this issue. The obstacles and objections raised by some member states haven’t gone away,” said a high-ranking EU official. “We’ll address the issues as they arise.”
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