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EU seeks to boost aid to Ukraine via bonds and frozen assets
Insights from Frankfurter Allgemeine, The Kyiv Independent, and Foreign Affairs
The News
EU leaders are meeting on Thursday and Friday to discuss how to ramp up their support for Ukraine and boost European defense production, as U.S. aid to Ukraine will likely be delayed for at least another month.
The European Council summit’s agenda includes a plan proposed by EU Commission President Ursula von der Leyen to use the profits generated from frozen Russian assets to fund Ukraine, as well as a France-backed proposal to issue defense bonds, which is facing resistance from Germany and the Netherlands.
The two-day meeting of European leaders comes as Washington lawmakers are about to go on recess, likely punting a possible vote on U.S. assistance to Ukraine until April at least.
SIGNALS
The EU seeks to get serious on defense
As European countries worry about what would happen if the U.S. were to pull back its European security umbrella, the EU has sought to forge a more muscular role for itself through different initiatives. Ursula von der Leyen has supported the idea of appointing an EU defense commissioner, and has also proposed using 90% of the profits from frozen Russian funds to buy weapons for Ukraine. The idea has gained momentum, although Hungary and Slovakia remain skeptical, Politico reported. Meanwhile, a majority of EU countries support allowing the bloc’s lending arm, the European Investment Bank, to finance weapons, while some nations want the EU to issue bonds to raise funds for defense, like it did to finance its COVID-19 pandemic recovery.
Europe and Ukraine have shortfalls in key areas
European nations are $60 billion away from hitting NATO’s defense spending pledge of 2% of GDP, while Ukraine has faced a sharp drop in foreign funding since the start of 2024. Unless European countries invest in their own defense capacities, they “could end up in the position Ukraine is in now, their war efforts undermined by a shortfall of U.S. supplies” in a potential future crisis where Washington is either unwilling or unable to support Europe, the Center for Strategic and International Studies’ Max Bergmann wrote in Foreign Affairs.
For Ukraine, the problem is a reality: President Volodymyr Zelenskyy has told the U.S. that his country needs the $60 billion in military and financial support that is stuck in Congress within a month, while Kyiv requires $38 billion in external funding for its budget in 2024, its deputy finance minister said in early March.
