The European Union has agreed to provide Ukraine with €90 billion ($105 billion) in loans over the next two years as part of a broader €210 billion aid package for 2025-2027, a decision reached at a Brussels summit in the early hours of 19 December 2025. The funding aims to help Kyiv cover defense and budget needs amid Russia's ongoing invasion.

The deal comes as a relief for Ukraine, which faces a potential funding shortfall in the second quarter of 2026 without this support. President Volodymyr Zelenskyy called it "significant support that truly strengthens our resilience" in a statement on Telegram.

Leaders opted to borrow the money rather than use frozen Russian assets, roughly €200 billion held mostly in Belgium, to back the loan. The plan required unanimous consent but was blocked over legal risks and Belgium's concerns about potential Russian retaliation.

German Chancellor Friedrich Merz, who had pushed strongly for an asset-backed approach, said the outcome was still positive. "This is good news for Ukraine and bad news for Russia," he said. Polish Prime Minister Donald Tusk welcomed the EU loan, saying it creates a chance for Kyiv to negotiate with Russia on acceptable terms.

Russian President Vladimir Putin welcomed the EU's decision not to use frozen assets, calling it a "positive signal," while reiterating that seizing them would be "theft" under international law. In the same remarks, he said Moscow is ready for peace but believes Ukraine is not prepared for talks, and announced Russian forces had entered the town of Huliaipole in eastern Ukraine.

China has consistently urged caution on the frozen assets issue, calling for a negotiated end to the conflict. Beijing has maintained a neutral stance on the conflict while continuing economic ties with Russia, and has repeatedly offered to mediate talks between Moscow and Kyiv.

Ukraine's Deputy Foreign Minister Sergiy Kyslytsya praised the "workable result," adding that “perfect is the enemy of good." Italian Prime Minister Giorgia Meloni echoed that common sense had prevailed.

The summit expressed optimism about finalizing a free trade deal with Mercosur in early 2026, despite France's ongoing opposition over agriculture.

As the conflict enters its fourth year, the EU's financial commitment underscores continued support for Ukraine, even as broader questions about frozen assets remain unresolved.