European Union leaders are meeting in Brussels this Thursday with the aim of agreeing on how to finance Ukraine's economic and military needs in the coming years. Ukrainian President Volodymyr Zelensky plans to attend the summit as a guest. The most debated financing model involves making Russian state assets frozen by EU sanctions available to Ukraine in the form of a loan. Kyiv would only have to repay these assets if Russia, which vehemently rejects the plan, pays reparations after the war.

“You know my position. I believe that, as the Commission has proposed, we should use Russian assets to support Ukraine through a loan. Either we use the assets, which are frozen, or we have to help Ukraine with European debt. I know there are those who have reservations, especially the Belgian government, but I believe these can be overcome,” said German Chancellor Friedrich Merz upon his arrival at the summit.

Polish Prime Minister Donald Tusk went further: “The alternative is clear. Either we give money today or we will deliver blood tomorrow. And I am talking about Europe,” he said upon his arrival at the summit. “That's all I have to say today,” he added, declining to take questions from reporters.

European credibility and the Mercosur agreement are at stake

The European Union is risking part of its credibility with the United States. The Europeans pledged to guarantee most of the financial and military support to Kyiv for the next two years, after Donald Trump decided to cut off US funding. If no decision is reached, Ukraine will run out of money starting in the first quarter of 2026. “If we don't achieve this, the European Union's capacity for action will be seriously compromised for years, and even longer,” Merz warned.

In parallel to the summit, EU countries could reach an agreement, as the Brazilian president is urging, to imminently sign the free trade agreement with the four Latin American countries of Mercosur: Brazil, Argentina, Uruguay, and Paraguay. “It is an important agreement, and after 26 years of negotiations,"It must be ratified so that the EU maintains its credibility in the world and in negotiations on other trade agreements," Merz said. Merz has been one of the main proponents of the agreement, seeing it as a step in the strategy to address the turbulence in the world of international trade, and his government has already approved its signing.

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