EU and UK Near Deal on Ukraine Arms Procurement

(BRUSSELS, BELGIUM) – The European Union is preparing to allow Ukraine to use a 60 billion euro defence loan to buy British weapons, according to sources cited by Bloomberg. The move would open the EU funded programme to UK defence companies for the first time and represents a significant step in defence cooperation between Brussels and London.

The loan facility, valued at 60 billion euros, is equivalent to approximately 69 billion US dollars or 54.4 billion British pounds at current exchange rates. It is designed to finance Ukraine’s defence procurement as the country continues to resist Russian military aggression.

After several months of negotiations, the EU is close to finalising an agreement with the British government that would give UK arms manufacturers access to the funding programme. Sources said the deal could be announced as early as next week during a meeting in Paris of the Coalition of the Willing, the group of nations led by Britain and France that support Ukraine.

Under the arrangement, Britain will not be required to make a fixed contribution to join the programme. Instead, the British government will make payments based on the volume of loan funds that Ukraine directs towards purchasing weapons from UK producers. The size of these contributions will be determined by the value of each contract and the associated loan servicing costs.

The agreement is seen as a way of accommodating London after the two sides failed to agree on British participation in the EU’s 150 billion euro SAFE defence fund. Those earlier talks stalled over the EU’s demand for an entry contribution from Britain. The Ukraine loan programme negotiations, by contrast, moved ahead more swiftly. Several EU member states, including the Netherlands, actively pushed for a rapid conclusion of the deal.

Brussels officials recognise that the arrangement will benefit Ukraine most directly, as it will simplify the purchase of British armaments and support further integration of the defence industries of both countries. Access to British military technology and equipment is expected to broaden Ukraine’s supply options at a critical time.

Plans had initially called for the deal to be announced during an upcoming UK EU summit, alongside a possible decision on British access to an EU investment fund for technology companies. Those plans were postponed until later this year following the resignation of Prime Minister Keir Starmer. According to sources, the defence procurement agreement was largely finalised on the sidelines of the NATO summit held this week in Ankara, Turkey.

The development comes as European defence ministers from nine countries have urged the European Commission to grant Ukraine maximum flexibility in using a separate 90 billion euro loan to meet urgent military needs. The combined financial support illustrates the scale of international efforts to sustain Ukraine’s defence capabilities through a mixture of grants, loans and direct equipment transfers.

No local currency figures for individual weapons contracts were provided. The wider context is one of deepening defence industrial cooperation between European nations and Ukraine, as countries seek to boost production capacity and streamline procurement processes in response to the continuing Russian aggression.