Politico: EU divided over Ukraine's right to buy US weapons using €90bn loan

Politico has reported that Germany and the Netherlands support allowing US-made weapons to be purchased using a €90 billion EU loan, while France insists on prioritising European manufacturers.

Source: Politico

Details: EU countries agreed on this financial support for Kyiv at the European Council summit in December, but member states still need to agree on the formal conditions of the funding. This is expected to involve tense negotiations with Paris, which is seeking to prevent EU funds from being channelled to Washington amid divisions within NATO.

French President Emmanuel Macron is pushing to give priority to European defence companies in order to strengthen the bloc's defence industry – even if this means that Kyiv would not be able to immediately purchase all the weapons it needs to deter Russian forces.

Most countries, led by governments in Berlin and The Hague, instead believe that Kyiv should have greater freedom in how it uses the EU financial package to fund its defence, according to position papers seen by the outlet.

Critics argue that the French initiative to impose a strict "Buy European" principle would tie Kyiv's hands and limit its ability to defend itself against Russia.

"Ukraine also urgently requires equipment produced by third countries, notably US–produced air defence systems and interceptors, F-16 ammunition and spare parts and deep-strike capacities," the Dutch government wrote in a letter to other EU countries seen by Politico.

While most countries, including Germany and the Netherlands, support the general "Buy European" principle, only Greece and Cyprus support the French initiative to restrict the scheme exclusively to EU-based companies, according to several diplomats familiar with the talks.

According to two EU diplomats briefed on the discussions, more than two thirds of the funding is expected to be allocated to military spending rather than general budget support.

Background:

• The European Commission is preparing to announce a legislative proposal on Wednesday, 14 January, to provide Ukraine with a €90 billion EU loan.
• On 18–19 December, the European Council decided to grant Ukraine a €90 billion loan for 2026–2027, financed through EU borrowing on capital markets and backed by EU budget reserves under an enhanced cooperation mechanism with Ukraine.

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