The European Union has committed €90 billion to supporting Ukraine through 2026 and 2027, financed through borrowing on capital markets and backed by the EU budget. But a German MEP is questioning whether European governments understood the potential long-term liability when they approved the scheme — particularly because repayment is tied to Ukraine eventually receiving reparations from Russia.
INR Report: Based on reporting by RT HERE.
The European Union's latest financial commitment to Ukraine is enormous even by the standards established during four years of war.
The €90 billion Ukraine Support Loan will finance Kyiv's government and defence requirements during 2026 and 2027. Approximately €30 billion is intended for budgetary assistance and €60 billion for defence procurement and industrial capacity. Official EU documents confirm the package is financed through borrowing on capital markets and backed by the EU budget. (Consilium)
But German MEP Fabio De Masi has raised a more fundamental question:
If Ukraine cannot repay the money, who ultimately carries the liability?
According to RT's report, De Masi asked the European Commission for a breakdown showing how the financial burden would fall across individual EU member states.
He says the Commission could not provide one.
€90 Billion — But No Member-State Breakdown
De Masi, who co-chairs Germany's Sahra Wagenknecht Alliance, told Berliner Zeitung that the European Commission apparently could not specify the extent to which individual EU countries would have to guarantee the Ukraine loan.
According to the Commission response cited by De Masi, a breakdown of the financial burden by member state could not be provided.
That does not mean the loan has no financial backing.
The official EU structure is clearer than RT's headline might suggest.
The €90 billion package is a limited-recourse loan, financed through EU capital-market borrowing and backed by EU budget “headroom”. Czechia, Hungary and Slovakia are specifically protected from financial obligations arising from the guarantee mechanism under the enhanced-cooperation arrangement. (Economy and Finance)
The unresolved issue raised by De Masi is therefore more precise: how would the ultimate burden be distributed among participating countries if the expected repayment mechanism fails?
That is an important distinction.
Ukraine Repays Only After Russia Pays Reparations
The unusual feature of the arrangement is the repayment condition.
Official EU documentation says Ukraine is expected to repay the loan only after it receives reparations from Russia. Until then, Russian Central Bank assets held within the EU are to remain immobilised, and the Union reserves the right to use those assets toward repayment in accordance with EU and international law. (Economy and Finance)
That creates an obvious uncertainty.
There is presently no peace settlement requiring Russia to pay those reparations.
There is no agreed final reparations figure.
And there is no certainty that Russia will ever voluntarily make such payments.
The EU has therefore created a very large financial arrangement whose intended repayment mechanism depends partly upon the eventual outcome of a war that remains unresolved.
De Masi Warns of a ‘Bottomless Pit of Debt’
De Masi has attacked the arrangement in considerably stronger terms.
According to RT, he questioned how Germany's government and parliament could approve such an obligation without, in his view, sufficiently assessing the potential consequences.
He also alleged that some of the money would ultimately benefit corrupt Ukrainian oligarchs.
That allegation should be distinguished from established fact.
Ukraine has faced longstanding corruption and governance problems, but the EU's loan itself contains explicit conditions relating to the rule of law, anti-corruption measures, economic resilience and financial sustainability. The Council describes the package as operating within a “robust and conditional framework.” (Consilium)
Whether those safeguards prove effective is a separate question and one that deserves continuing scrutiny as tens of billions of euros are distributed.
€60 Billion Is For Defence
Perhaps the most striking feature of the programme is where most of the money is going.
This isn't primarily a reconstruction loan.
Approximately two-thirds — €60 billion — has been allocated to defence-related support, with the remaining €30 billion directed towards Ukraine's budgetary requirements. (Defence Industry and Space)
For 2026 alone, the Council approved access to €45 billion: €8.35 billion through macro-financial assistance, €8.35 billion through the Ukraine Facility and €28.3 billion for Ukraine's defence-industrial capabilities. (Consilium)
The European Commission has specifically identified defence procurement, including Ukraine's drone industry, as an early priority. (Defence Industry and Space)
This matters because the EU is increasingly moving beyond providing assistance to Ukraine and towards financing a substantial part of the country's continuing military capability.
More Than €216 Billion Already Provided
RT reports that the European Union has provided more than €216 billion to Ukraine since the conflict escalated in 2022, with Germany accounting for tens of billions in support.
The new €90 billion facility represents another major escalation in that financial commitment.
RT also reports that the first €3.2 billion tranche was disbursed in late June, followed by another €3.9 billion earmarked for drone procurement.
For European taxpayers, the central question is therefore becoming less about whether Europe should support Ukraine and more about what the financial endpoint of that support actually is.
Loans Are Still Debt
Political language can sometimes obscure a simple financial reality.
The European Union is borrowing this money.
The Commission raises funds on capital markets. Investors buying that debt expect to be repaid according to the terms of those securities.
Ukraine's obligation to the EU and the EU's obligation to its bondholders are not the same thing.
If Ukraine eventually receives Russian reparations and repays the loan, the intended structure works.
If it does not, the political and fiscal question becomes considerably more complicated.
Someone must ultimately service the debt.
That is the issue sitting beneath De Masi's challenge to Brussels.
The Russian Position
Russia rejects the premise underlying the EU's repayment mechanism.
RT quotes Kremlin spokesman Dmitry Peskov accusing the European Union of reaching into taxpayers' pockets to prolong the conflict, while Moscow has dismissed expectations that it will eventually finance Ukraine through reparations.
Those statements represent the Russian government's position and should not be treated as neutral assessments.
But Moscow's refusal matters financially because the EU's repayment structure explicitly anticipates reparations from Russia.
The viability of that mechanism therefore depends on a future political and legal settlement that does not yet exist.
The Frozen Russian Assets Question
The EU has also left open another possibility.
Hundreds of billions of euros in Russian sovereign assets have been immobilised by Western governments since 2022.
EU documents state that those assets will remain frozen until Russia ends its war and compensates Ukraine, while Brussels reserves the right to use them toward repayment of the Ukraine loan in accordance with international and EU law. (EUR-Lex)
That wording is significant.
It does not mean the principal has simply been confiscated and spent.
Using sovereign assets outright raises difficult questions concerning property rights, sovereign immunity, international law and the potential consequences for Europe's reputation as a safe jurisdiction for foreign reserves.
The EU has consequently created financial flexibility without resolving all of those legal questions.
The Accountability Question
There is a legitimate strategic argument for the European position.
EU governments believe Ukraine's defence is directly connected to European security and that allowing Kyiv to collapse financially or militarily could ultimately impose much greater costs on Europe.
That is the rationale behind the €90 billion package.
But supporting Ukraine does not remove the requirement for financial accountability.
Indeed, the larger the commitment becomes, the stronger that requirement should become.
European citizens are entitled to know how the debt is guaranteed, what happens if reparations never materialise, how losses would be allocated, what anti-corruption safeguards exist and what conditions would cause funding to be suspended.
Those are not necessarily arguments against supporting Ukraine.
They are questions about the governance of public money.
Does This Affect New Zealand?
Not directly in the sense that New Zealand taxpayers do not guarantee the European Union's €90 billion loan.
But the broader principle certainly applies here.
New Zealand has also provided financial, military, humanitarian and training support to Ukraine and is increasingly being asked to participate in wider Western security initiatives.
For a small country with limited fiscal resources, every overseas commitment should pass a straightforward National Interest Test.
What is the objective?
How much will it ultimately cost?
How will success be measured?
Who carries the financial risk?
And what is the exit point?
Those questions should apply whether governments are spending $90 million or €90 billion.
The Bigger Question
The controversy surrounding the Ukraine Support Loan is not simply whether Ukraine deserves European assistance.
The more important issue is whether democratic governments should commit extraordinary amounts of public money without citizens being able to clearly see the potential long-term liability.
The EU knows how much it intends to borrow.
It knows where much of the money will go.
It knows that Ukraine is not expected to repay it until reparations are received.
What De Masi says Brussels cannot presently provide is a country-by-country answer to the question that eventually matters whenever governments borrow money:
Who pays if the original repayment plan doesn't work?
That is a question European taxpayers have every right to ask.
Source
RT: EU has no idea who will pay for €90 bn Ukraine loan – MEP, published 11 August 2026. Source article supplied to INR.
Official EU documentation used to independently verify the structure and purpose of the €90 billion Ukraine Support Loan: European Commission and Council of the European Union. (Consilium)
Independent reporting. Original context. Credited sources.