European Union member states have finally agreed to unlock a €6.6 billion military aid package for Ukraine, breaking a two-year deadlock that had paralysed the bloc's main reimbursement mechanism for donated weapons. The political agreement was reached on Friday during a meeting of the Political and Security Committee in Brussels, according to EU diplomats.
The so-called European Peace Facility (EPF) was designed to partially compensate countries for the arms and ammunition they send to Kyiv. In the early phase of the war, it was one of the EU's most important support tools, regularly replenished with fresh funds. But in May 2023, Hungary, then led by Viktor Orbán, imposed a veto that froze the scheme entirely. Budapest objected to Kyiv's decision to place OTP Bank, Hungary's largest commercial lender, on its list of "international sponsors of war" – a catalogue that was later scrapped in 2024 after Western allies pushed back.
Despite the removal of that trigger, Hungary kept its veto, frustrating other capitals and forcing Brussels to create alternative assistance programmes. The logjam was only broken this year after Orbán lost the April parliamentary elections and Péter Magyar became prime minister. Since then, member states have been negotiating the terms for releasing the funds.
EU foreign policy chief Kaja Kallas announced the breakthrough on social media, writing: "That's good news for Ukraine and bad news for Russia." She added: "Moscow's hybrid attacks try to intimidate Europe into scaling back its support for Ukraine. Europe is doing the opposite."
According to Kallas, the €6.6 billion will be split into three strands. Some countries will wire their share of €4.7 billion in reimbursements directly to Ukraine, though she did not name them. Several legislative acts still need to be adopted before the money is actually disbursed.
Ukraine's defence budget crunch
The timing is critical. Ukraine is facing a $27 billion (€23.67 billion) shortfall in its Ministry of Defence budget, a gap that threatens planned drone deliveries. The European Commission and the International Monetary Fund are in talks with the Ukrainian government to find a solution.
On Friday, President Volodymyr Zelenskyy warned that the budget crunch must be resolved between October and November to fund drone deliveries scheduled for the first three months of 2027. "Everyone understands that Ukraine cannot be left on its own and that more must be invested in Ukrainian-made drones and missiles, because most of this deficit is precisely the funding needed for weapons," he said.
The release of the EPF funds comes as Russian strikes continue to kill civilians across Ukraine, and as EU leaders debate the future of their support. The decision also follows reports that the US has approved a Patriot missile production licence for Ukraine, a sign of continued Western backing.
Analysts note that the unblocking of the EPF is a diplomatic victory for Kallas, who had made reviving the facility a priority. It also signals a shift in Budapest's stance under Magyar, who has pledged to repair ties with Brussels and maintain support for Ukraine.
Still, the funds are not a panacea. The EPF reimbursements cover only a fraction of what Ukraine needs, and the broader budget shortfall remains unresolved. As EU officials have warned about weapons returning from the front line, the bloc is also grappling with how to sustain its own defence production.
For now, the agreement is a clear message that Europe intends to stay the course. As Kallas put it, the EU is doing the opposite of what Moscow hopes.
