The European Union has rejected Ukraine’s request to receive part of the financial support planned for 2027 ahead of schedule. Brussels has urged Kyiv to implement reforms on which access to around €34 billion as early as 2026 depends, the Financial Times reports, citing a letter seen by the editorial team.
In the summer, Ukraine estimated its additional defence needs at $27 billion and asked the European Commission to cover the shortfall by releasing tranches early from the EU’s €90 billion loan. The loan was approved in late 2025.
The funding is intended to cover most of Ukraine’s needs in 2026–2027. It provides for the allocation of up to €45 billion annually, but the funds are conditional on completing specific reform milestones.
In 2026, Ukraine received €15.7 billion. According to the FT, delays in implementing reforms were one of the reasons.
Conditions for Further Funding
The EU is urging Ukraine to meet conditions that could unlock access to around €34 billion in support in 2026. Among the required changes, the Financial Times names:
- abolishing the VAT exemption for small parcels;
- introducing new taxation rules for digital platforms.
Both measures have already passed parliament. However, they include an amendment that weakens rules concerning politically exposed persons. According to the publication, its entry into force could jeopardise Ukraine’s fulfilment of the conditions for receiving EU funds.
European Commissioners Valdis Dombrovskis and Marta Kos stressed in a letter to the Speaker of the Verkhovna Rada that additional financial assistance for Ukraine in 2026 is available provided that the necessary reforms are carried out.
“Preventing any weakening of Ukraine’s rules on politically exposed persons is critically important”
Valdis Dombrovskis and Marta Kos, European Commissioners
Ukraine’s Needs and Talks with Partners
Ukraine needs additional funds, among other things, to increase production of drones and interceptors amid intensified Russian air attacks. The country’s military and budgetary needs in 2027 could amount to around €70 billion.
President Volodymyr Zelenskyy, in an interview with the FT, denied reports of tense negotiations with European Commission President Ursula von der Leyen over reforms. According to him, the meeting was “very good,” although Ukraine cannot always carry out reforms on the usual schedule during wartime.
“We need to defend ourselves now, and some decisions, financial decisions, cannot wait. Because this is a matter of our stability”
Volodymyr Zelenskyy, President
The European Commission is also assessing Ukraine’s financial needs for 2027. The results are expected to be presented to EU leaders in mid-October.
Ukraine is also negotiating with the IMF on further disbursements under its $8 billion programme. According to the FT, they depend on agreements with the EU and other partners on covering Ukraine’s needs in 2027.
On September 30, Prime Minister Serhiy Koretskyi said that the Cabinet of Ministers had begun cutting spending to the maximum extent possible.
