The European Union is close to reaching an agreement on the release of €6.6 billion from the European Peace Facility (EPF) for Ukraine, which has been blocked for over two years due to Hungary’s stance. Radio Free Europe/Radio Liberty has learned the details of the discussions on the likely distribution of the Fund’s resources from EU diplomats and officials.
The compromise proposal currently being discussed by member states provides for the allocation of funds across three areas.
Around €1 billion is planned to be allocated to new military aid for Ukraine through a joint arms procurement mechanism.
A further €900 million or so could be allocated to the EU mission to train Ukrainian military personnel, EUMAM Ukraine.
The remaining funds are intended to partially compensate member states for the weapons and military equipment they have already supplied to Ukraine in previous years, as was originally envisaged and promised to member states.
“Of the €6.6 billion, €4.7 billion is merely compensation for deliveries that have already been made. This is not new money for Ukraine,” noted one of the diplomats.
Another emphasised that, given the more than €40 billion in military aid that EU member states have already provided to Ukraine, the new sum is not significant, nor is the compensation for EU countries that have already transferred weapons and military equipment to Ukraine.
According to Radio Free Europe’s sources, the main debate currently centres on exactly what level of compensation member states will receive. Countries that transferred significant quantities of arms to Ukraine at the start of the full-scale war prefer a higher level of compensation. However, the current compromise is increasingly leaning towards compensation of around 10% for the entire period of supplies to Ukraine. Certain states are also prepared to transfer these funds to Ukraine after receiving compensation.
Anita Hipper, the European Commission’s spokesperson for foreign affairs, confirmed that the compromise proposed by the head of European diplomacy, Kaja Kallas, provides for three ways of using the funds.
“We now have a proposal from the High Representative – the Vice-President – to use these funds to reimburse Member States for the costs of past arms deliveries, as well as to finance new joint procurements and support the EUMAM mission in Ukraine. But discussions are ongoing,” said Hipper.
Ukraine has already called on the European Union to use the unblocked funds from the European Peace Fund to strengthen its air defence.
In early June, following one of Russia’s large-scale shelling attacks, Foreign Minister Andriy Sibiga stated that one of the first steps after the EPF is unblocked should be to fund the PURL programme and procure additional Patriot systems and missiles for Ukraine.
The European Peace Facility was established as an off-budget EU mechanism to finance military aid to partners. Following the start of Russia’s full-scale invasion, it became one of the instruments for supporting Ukraine, providing for the reimbursement of member states’ costs for supplying weapons to Ukraine.