Commission Proposes €31.7 Billion for Ukraine Arms and €13.3 Billion for Budget in 2027, With €70 Billion Gap Still Open

Since the EU adopted its €90 billion Ukraine Support Loan in February and began paying out the first €45 billion this year, the open question has been how the second half would be spent. The Commission answered it today, Oct. 30, with a proposal for the Council of the EU.

Under the plan, €31.7 billion goes to Ukraine's defense industrial capacity and €13.3 billion to budget support. The budget money is split equally between the Ukraine Facility and the Macro-Financial Assistance program, and the latter is tied to Ukraine's IMF program. The full €45 billion is to be provided by Dec. 31, 2027.

The mix tilts further toward weapons than this year's. The 2026 half of the loan carried €28.3 billion for defense and €16.7 billion for budget support.

How the money would move

The weapons money will not go out in one lump. Euronews reports that the €31.7 billion will be paid gradually as Kyiv submits contracts for arms, and that submissions can begin this year so deliveries arrive on time in 2027.

The budget money comes with strings. The Commission says it will be underpinned by conditions on the rule of law, anti-corruption, economic resilience and sustainability, plus safeguards for the EU's financial interests. Euronews reports that the €13.3 billion is conditional on reforms, some tied to Ukraine's EU accession process.

Euronews also reports that Brussels will concentrate funds in the first half of 2027 so assistance does not run dry. The Commission's own statement says it will take steps so disbursements can happen in early 2027, once the Council adopts the decision.

The proposal follows the Commission's positive assessment of the financing strategy Ukraine submitted on Oct. 26.

The gap is still there

The €45 billion does not close Ukraine's 2027 hole. Commission spokesperson Balázs Ujvári said on Oct. 19 that the shortfall is about €70 billion even after counting the €45 billion the EU has set aside for next year and some partners' commitments. "We cannot do this all alone," he said. "Our partners in general must step up."

Commission officials insist the EU will cover no more than two-thirds of the gap, roughly €46 billion, according to Euronews. The rest is meant to come from other allies. An internal document seen by Euronews names joint debt as the frontrunner for the EU's share.

That option is getting pricier. Ujvári said EU 10-year borrowing rates rose from 3.2% to just above 4% in six months. Asked on Oct. 19 whether the Commission would revisit using frozen Russian assets, he called it "a little bit early" to discuss options in that detail.

According to Euronews, the internal document blames the shortfall partly on the war's length. The €90 billion loan was designed on the assumption that fighting would end in 2026. The war is now well into its fifth year.

Zelenskyy asked EU leaders on Oct. 16 for at least €70 billion more for 2027. They tasked the Commission with a proposal but set no deadline.

Partners and holdouts

Other donors have moved this month. Norway pledged $9 billion for Ukraine, and the U.K. announced a $13 billion pledge, its largest ever, according to the Kyiv Independent. Canada is widely expected to join, but the size of any commitment is unclear. Von der Leyen said the topic is "high on the agenda" at the EU-Canada summit in Montréal.

Not every member state is on board with new money. Slovak Prime Minister Robert Fico said Slovakia and Hungary would opt out of new aid but would not block others, according to Euromaidan Press.

Von der Leyen framed the proposal as stability for Kyiv. "We are providing Ukraine with much-needed predictability and helping maintain essential public services," she said. Zelenskyy, ahead of the announcement, asked for faster disbursements: "The sooner we start receiving the corresponding tranches for our drone production, air defence procurement, budget support and other vital expenditures, the better our position in 2027 will be."

The €3.7 billion still in limbo

Conditionality has already cost Kyiv time. Euronews reports that a €3.7 billion payment has been delayed. On Oct. 15, Ukraine's parliament passed, on its third attempt, a law ending the VAT exemption for foreign parcels worth up to €150 from July 1, 2027. The Commission had flagged the law as one of 12 conditions for that tranche, and lawmakers had rejected it twice despite IMF pressure.

Ujvári said on Oct. 19 the Commission was analyzing the new laws and would give its assessment afterward. The Commission has not announced a decision.

What comes next

The Council must adopt the implementing decision. Member states will then decide how to allocate the money across the Ukraine Facility, Macro-Financial Assistance and defense industrial capacity.

The Commission has given no timetable for a proposal to fill the remaining €70 billion gap. EU leaders set no deadline when they asked for one.

The Commission has said disbursements can begin in early 2027, and the Council vote determines whether that timeline holds.