The European Union has given final approval to the €90 billion loan for Ukraine after Hungary lifted its veto, ending an explosive saga that saw Prime Minister Viktor Orbán, in his last months in office, push the bloc’s internal norms to the breaking point.
The internal procedure was launched by ambassadors on Wednesday and finalised on Thursday. No objections were raised, and the last pending regulation, which needs unanimity to amend the EU budget, was approved.
The sought-after breakthrough came two days after Ukrainian President Volodymyr Zelenskyy announced that the Druzhba pipeline, which carries cheap Russian oil to Hungary and Slovakia, had been repaired and could resume operations.
The interruption of oil flows through Druzhba was at the core of Orbán’s decision to veto the €90 billion loan in February. The last-minute blockage outraged other EU leaders, who furiously condemned it as an “unacceptable” attempt to “blackmail”.
The fact that Orbán had endorsed the loan in December and secured an opt-out for his country was particularly aggravating for other member states. One senior diplomat described the veto as a “turning point” in relations between Brussels and Budapest.
Orbán made his dispute with Zelenskyy over Druzhba a recurring theme in his re-election campaign. The incumbent, however, was resoundingly defeated by opposition leader Péter Magyar under the promise of restoring the rule of law.
The Hungarian transition, the first in 16 years, paved the way to break the deadlock.
Cyprus, the country that holds the EU Council’s rotating presidency, seized the window of opportunity and added the loan to the meeting of ambassadors even before Zelenskyy announced the repair of Druzhba.
“The unblocking is the right signal under the current circumstances. Russia must end its war. And the incentives for that can arise only when both support for Ukraine and pressure on Russia are sufficient,” Zelenskyy said on Wednesday.
“It is important that the European support package becomes operational swiftly.”
The European Commission, which will manage the financial scheme, says the first disbursement to Kyiv will be made “as soon as possible”once all the legal and technical documents are in place. The executive has a cash reserve at its disposal to move fast.
For 2026, Brussels intends to gradually transfer €45 billion, with €16.7 billion allocated for financial support and €28.3 billion for military support. Payments will be made conditional on the reforms that Kyiv passes. Any reversal in the fight against corruption could trigger a temporary suspension in assistance.
Notably, the military strand of the loan will have “Made in Europe” provisions to ensure as much funding as possible goes to domestic producers, rather than US manufacturers.
The remaining €45 billion will be kept for 2027 and cover two-thirds of Ukraine’s funding needs. Western allies are expected to cover the last one-third.
The joint borrowing will exclude Hungary, Slovakia and the Czech Republic. The other 24 member states will pay around €3 billion in annual interest rates as a result.
Ukraine will only be asked to return the €90 billion loan if Russia ever agrees to war reparations, something that Moscow has categorically ruled out.
The Commission insists it retains the right to use the €210 billion in immobilised assets of the Russian Central Bank to compensate for the lack of reparations.
SOURCE: EURONEWS
