The Council agrees allocation of additional EUR 5 billion to support Ukraine militarily

The Council of the European Union decided to increase the financial ceiling of the European Peace Facility (EPF) by €5 billion in current prices, and ringfence this top-up for Ukraine, by establishing a dedicated Ukraine Assistance Fund (UAF) within the EPF, a statement on the website of the European Council reads.

“The EU is living up to its commitments. The Ukraine Assistance Fund turns our words into action. With the fund, we will continue to support Ukraine defend itself from Russia’s war of aggression with whatever it takes and for as long as we need to,” stated Josep Borrell, High Representative for Foreign Affairs and Security Policy, as quoted on the website.

In parallel, the Council decided today to improve the governance rules for the facility to make them more sustainable and adapt them to the new international circumstances, reads the press release.

“The improved governance rules will build on well-functioning national procurement structures as well as existing framework contracts, leveraging both a lead nation approach and the European Defence Agency (EDA), and including the joint procurement of the required defence equipment from the European defence industry and Norway – including small and medium sized enterprises – while allowing for flexibility in supply chains which may include operators established or with production facilities outside the EU or Norway,” reads the statement on the European Council website.

Following today’s decision, the EPF financial ceiling will total over €17 billion for the 2021-2027 period.

Dmytro Kuleba, Minister of Foreign Affairs of Ukraine, also announced the allocation of an additional €5 billion for military assistance to Ukraine. He participated in a meeting of the EU Foreign Affairs Council on Monday, March 18. The Minister expressed his gratitude to his colleagues for this step and thanked the Czech Republic for its timely initiative to purchase artillery shells for Ukraine and all EU member states that have already contributed to its implementation.

On the eve of the meeting, Josep Borrell, High Representative for Foreign Affairs and Security Policy, stated that EU foreign ministers would approve a €5 billion military aid package for Ukraine at their meeting, and would also likely agree to use funds from frozen Russian assets.

Last week, ambassadors of EU member states decided to increase the financial ceiling of the European Peace Facility by €5 billion, from is used to reimburse member states for weapons supplied to Ukraine.

In January, Josep Borrell’s office proposed reforming the European Peace Facility and creating a special military fund for Ukraine on its basis. It was proposed that it would absorb the current assets of the European Peace Facility (about EUR 6.5 billion), and in addition, it would be increase by EUR 5 billion annually for the next four years.

The European Peace Facility was established in March 2021 to finance all Common Foreign and Security Policy (CFSP) activities related to military and defence matters.

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