EU leaders have agreed to fund Ukraine with a €90bn loan backed by the bloc’s shared budget for the coming two years, but only after a painstakingly developed “reparations loan” idea using Russia’s immobilised assets was cast aside, write Paola Tamma and Laura Dubois.

European Union leaders have stalled in talks about providing a massive loan to Ukraine using frozen Russian assets.

Europe’s 90-billion-euro interest-free loan to keep Ukraine’s economy and military from a budgetary blackhole through 2027 didn’t come about in the way some leaders wanted, but the fact it came about at all is a win for the bloc.

Poland’s prime minister Donald Tusk is a pretty blunt talker, particularly when it comes to the threat he feels Russia poses beyond Ukraine to the rest of Europe. The leaders of the European Union’s 27 states were set to spend Thursday evening locked in negotiations about how exactly to fund a major package of financial aid for Ukraine.

European Union leaders will try to overcome staunch resistance to both a funding plan for Ukraine and a massive trade deal with South America during a summit in Brussels starting Thursday — insisting that the bloc’s reputation is on the line.

The European Union is on the precipice of a momentous decision on whether to use frozen Russian assets to finance more support for Ukraine. Critics argue the plan is legally questionable and risks retaliation by Moscow.

The meeting on Thursday is seen as a critical test of the group’s strength in the wake of President Donald Trump calling them weak.

The European Commission has proposed that the leaders use some of the frozen assets — totaling 210 billion euros ($246 billion) — to underwrite a 90 billion-euro ($105 billion) “reparations loan” to Ukraine. The U.K., Canada and Norway would fill the gap.