London has agreed to join in the long-in-the-making EU plan to give Ukraine a much-needed financial boost.
The United Kingdom has joined the European Union's €90 billion loan for Ukraine, which is designed to cover the country's financial and military needs for 2026 and 2027.
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The inclusion of London has been in the works for several months, and was formally announced on Monday as the so-called "Coalition of the Willing" of Ukraine-backing governments convened in Paris.
"Together, we are supporting Ukraine's brave resistance," European Commission President Ursula von der Leyen said on social media.
The deal means Ukraine will be allowed to procure weapons and ammunition from British defence companies, such as BAE Systems, QinetiQ and Babcock International, using the aid that Brussels sends under the loan.
In turn, London will have to cover a share of €3 billion in annual interest rates, depending on how much its firms benefit.
"The UK will provide a fair and proportionate contribution to the costs arising from borrowing, commensurate with the value of contracts awarded to UK companies," the two sides said in a joint statement.
EU leaders agreed to set up the extraordinary loan in December through joint debt. Hungary, Slovakia and the Czech Republic were excluded after fraught negotiations.
For 2026, Brussels intends to gradually transfer €45 billion to Ukraine: €16.7 billion for financial support and €28.3 billion for military support, some already wired out. The remaining €45 billion will be kept for 2027 and cover two-thirds of Ukraine's funding needs, with Western allies expected to cover the other one-third.
Payments will be made conditional on the reforms that Kyiv passes, and any reversal in the fight against corruption could trigger a temporary suspension in assistance.
Notably, the military strand of the loan is linked to "Made in Europe" provisions to ensure as much funding as possible goes to domestic rather than foreign producers.
However, the "Made in Europe" clause is already under strain as Russia pummels Ukraine with ballistic missiles, exposing a dire need for US-made Patriot interceptors.
Last week, Germany, the Netherlands, Poland, the Baltics and the Nordics penned a joint letter asking the Commission to grant Kyiv full flexibility under the loan, including through "pragmatic" derogations to the "Made in Europe" requirement. (Brussels has already granted such exemptions for the purchase of drone equipment.)
"Ukraine's urgent needs should be front and centre," they wrote.
Ukraine will be asked to repay the €90 billion only if Russia agrees to war reparations, something that Moscow has categorically ruled out.
The Commission insists it retains the right to use the Russian Central Bank's €210 billion in immobilised assets to offset the lack of reparations.