European Union foreign ministers will approve a boost of 3.5 billion euros ($3.81 billion) to a military aid fund used to bankroll weapons and ammunition for Ukraine, officials said on Friday.
The ministers are expected to raise the financial ceiling on the European Peace Facility (EPF) – a fund that has already allocated some 5.6 billion euros in military aid for Ukraine – at a meeting in Luxembourg on Monday.
However, Hungary continues to block the allocation of another 500 million-euro tranche of the fund for Ukraine, according to officials.
Budapest has said it will not lift its block until Kyiv removes Hungarian bank OTP (OTPB.BU) from a list of companies it deems “international sponsors” of Russia’s war in Ukraine. Hungary has branded the bank’s inclusion “scandalous”.
“On Monday, a decision will be taken to top up the European Peace Facility by 3.5 billion euros,” said a senior EU official, speaking on condition of anonymity.
“But there will be no decision on a new tranche of the European Peace Facility for Ukraine because there is not yet agreement among member states on that.”
The fund, established in 2021, was conceived for the EU to help developing countries buy military equipment. But the 27-member union quickly decided to use it also to get weapons to Ukraine after Russia’s invasion in February last year.
The fund is separate from the EU’s budget, which is not allowed to finance military operations.
The fund allows EU countries that supply weapons and ammunition to Ukraine to claim back a portion of the cost. EU countries contribute to the fund according to the size of their economies.