Europe’s Financial Support for Ukraine: Challenges and Future Prospects
As the world prepares to mark the second anniversary of Vladimir Putin’s Ukraine invasion this week, Europe finds itself facing significant challenges in its financial support for Ukraine. The war that unexpectedly erupted on Europe’s borders has been deadlocked for some time, with Ukraine suffering a major defeat in the key town of Avdiivka. Furthermore, the much-needed financial aid from the United States is stuck, awaiting House approval. The unity between the European Union (EU) and NATO is starting to fray, with big decisions being held up and threatened with veto. Fatigue is setting in as the bills for supporting Ukraine continue to grow.
Despite these challenges, the EU and its regional allies have spent over $100 billion funding Ukraine’s defense effort since the start of the crisis. Earlier this month, EU leaders agreed to a $54 billion package for Ukraine between now and 2027. The United Kingdom, a major security player in the region, has also pledged over $15 billion to Ukraine since 2022. The US has spent $66 billion, with another $60 billion in the pipeline. While the West’s support for Ukraine has surprised many, the longer the war drags on, the more fatigue grows.
The political pressure on spending will become more visible as European Parliamentary elections take place in June, as well as national polls in multiple countries including the UK. European officials are aware of the difficulty US President Joe Biden is having with his own Ukraine package, highlighting the real-world impact of funding a costly overseas war when it comes into direct contact with domestic politics.
Adding to these challenges is the prospect of Donald Trump returning to the White House next year. Trump’s unclear stance on Ukraine and his anti-NATO rhetoric raise concerns about Ukraine losing momentum on the ground while America decides it has spent enough already. European officials fear that Putin is digging in and trying to wait out the West.
The next 12 months are crucial for Ukraine’s European allies. It is in Europe’s interest that Putin does not win this war. Therefore, officials argue that Europe must continue to spend on Ukraine, even if it becomes politically harder to do so. In the run-up to the US presidential election, the question of European security without America will inevitably be asked. While Ukrainian security is directly tied to wider European security, the immediate question of how to support Kyiv is subtly different from Europe’s long-term goal of greater security independence from the US.
Most officials argue that Europe can continue funding Ukraine even if the US pulls financial support. The EU has tools it hasn’t yet used and can explore using money tied up in frozen Russian assets to help fund Ukraine. While this money cannot legally be used to buy weapons, it can cover compensation costs, freeing up money for weapons from EU and national budgets. However, some diplomatic voices raise concerns about setting a precedent for using frozen assets to raise money for foreign wars.
The issue of arming Ukraine without American support poses a challenge as well. Europe currently lacks the manufacturing capacity to independently serve Ukraine over the next 12 months. However, Western diplomats are optimistic that arming Ukraine aligns with Europe’s drive to reduce its reliance on America.
Officials point to a recent deal brokered by NATO, where European countries have pledged to purchase 1,000 missiles from American firms that will be built in a new German factory. This highlights the need for Europe to buy more weapons and have a security policy that is not solely reliant on the US. By doing so, Europe can become fit to defend itself and cooperate with its old ally.
In conclusion, Europe faces significant challenges in its financial support for Ukraine. The war’s deadlock, delayed US aid, and fraying unity between the EU and NATO contribute to the growing fatigue. However, Europe remains committed to supporting Ukraine and believes it can sustain funding even without US support. The next 12 months are crucial for Ukraine’s European allies, who must continue spending to prevent Putin from winning the war. Europe’s long-term goal is to achieve greater security independence from the US, and arming Ukraine aligns with this objective. By becoming fit to defend itself, Europe can also maintain a positive relationship with future President Trump.
