EU Adds Rule to Back Ukraine Loans

What the document addresses
The European Union is providing large financial help to Ukraine after Russia’s invasion. The help is given mainly as loans, and the EU needs a guarantee that the money will be available when the loans are repaid. The current budget rules (the Multiannual Financial Framework, MFF, 2021‑2027) normally limit how much money can be set aside for such guarantees. Because Ukraine needs more support than the normal limits allow, the EU must change the rules.

How the problem is solved
The proposal amends Regulation (EU, Euratom) 2020/2093, which sets the MFF for 2021‑2027.

• A new sub‑paragraph is added to Article 2(3) that says the EU can mobilise a guarantee for Ukraine’s financial assistance over and above the MFF ceilings.
• The guarantee will be used only for the new “Reparation Loan” instrument that will give Ukraine loans to cover war‑related costs.
• The guarantee will not exceed the EU’s own‑resources ceiling, so it stays within the overall budget limits.

What changes as a result

• The EU can now secure the necessary funds for Ukraine’s loans even if the normal MFF limits would be reached.
• The regulation takes effect the day after it is published in the Official Journal, so the new rule is in force immediately.
• No actual money is spent during 2021‑2027; the guarantee is a promise that the money will be available when needed.
• The amendment is part of the urgent measures to support Ukraine and is binding in all Member States.