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Rachel Reeves welcomes EU deal to loan billions to Ukraine

Ukrainian President Volodymyr Zelensky has said the move will ‘truly strengthen our resilience’.

By contributor Christopher McKeon, Press Association Political Correspondent
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Supporting image for story: Rachel Reeves welcomes EU deal to loan billions to Ukraine
Chancellor Rachel Reeves said she is ‘pleased’ the EU had agreed a deal to loan Ukraine 90 billion euros (£78.8 billion) (Lucy North/PA)

Rachel Reeves said the UK’s support for Ukraine remains “iron-clad” as she welcomed a European deal to provide billions more in financial support for Kyiv.

The European Council agreed on Thursday to provide an interest-free loan worth 90 billion euros (£78.8 billion) to support Ukraine’s military and economic needs over the next two years.

The Chancellor said she is “pleased” a deal had been reached, adding: “The UK’s support for Ukraine remains iron-clad.

“We will work with partners to urgently consider options to ensure that Ukraine gets the funding it needs.”

Ukraine’s President Volodymyr Zelensky also welcomed the deal, saying it will “truly strengthen our resilience”.

Despite agreeing to provide the large loan, Thursday’s summit was unable to secure a deal on using frozen Russian assets to pay for it, as some European leaders had called for.

Headshot of Volodymyr Zelensky
Ukrainian President Volodymyr Zelensky has hailed the deal (PA)

Most of the assets are held at Belgium-based Euroclear, and Belgian Prime Minister Bart De Wever had previously resisted using them to finance Kyiv over fears of Russian retaliation.

EU leaders worked late into the night on Thursday to reassure Belgium it would be protected from any retaliation, but in the end opted to borrow the money from capital markets rather than use Russian assets to underwrite the loan.

Mr De Wever said the deal “avoided stepping into a precedent that risks undermining legal certainty worldwide”, while providing a “strong political signal” that Europe backs Ukraine.

But the issue of using froze Russian assets to finance Ukraine’s defence could come up again, with European Council president Antonio Costa saying the EU “reserves its right to make use of the immobilised assets to repay this loan”.

Meanwhile, the UK Government continues to press Roman Abramovich to transfer £2.5 billion from the sale of Chelsea Football Club to humanitarian causes in Ukraine.

The money is currently frozen as Mr Abramovich is subject to sanctions, but ministers on Wednesday granted him a licence to transfer the money to a humanitarian foundation in line with his commitment to do so in 2022.