European Commission proposes joint debt to bridge Ukraine's 2027 funding gap

The European Commission is preparing a joint debt issuance proposal to address a €70 billion deficit in Ukraine's 2027 state budget. The strategy aims to stabilize Kyiv's finances if contributions from non-EU partners fail to increase. Officials expect to present the plan at a summit scheduled for late November.

A forecast document reviewed by the Financial Times shows a sharp decline in external support. Allies outside the EU have pledged only €4 billion for next year, down from €19 billion in 2026. The United States, United Kingdom, Canada, and Japan combined are projected to contribute just €1 billion. The €70 billion gap includes military expenditures associated with weapons deliveries from the Biden administration. US President Donald Trump has halted all direct funding for Ukraine.

Brussels is maintaining that the European bloc bears the majority of the financial burden. A Commission spokesperson stated that the EU and its member states account for 80% of the aid promised for 2027. "Europe cannot meet Ukraine's financing needs alone," the spokesperson said. "International partners must also step up, including NATO allies."

Bilateral negotiations are ongoing with London, Ottawa, and other capitals. European officials are awaiting the release of the UK and Canadian budgets for 2027, hoping for new commitments. A spokesperson for Canada's finance ministry noted that Ottawa has committed a total of CA$27 billion to Ukraine since the 2022 invasion. The official declined to detail upcoming budget items, stating, "I won't speculate on what may or may not be included in next week's budget."

Japan’s Foreign Ministry disputed the Commission's assessment of future support. The ministry said the government "cannot make any definitive statements regarding the possibility of future financial support to Ukraine." It added that Tokyo is considering options based on future developments, including discussions among G7 members.

The funding shortage extends beyond the 2027 budget. The Commission estimates that NATO's 32 member states are €13 billion short of fulfilling their pledge to provide €70 billion in defense support for the current year.