European joint debt options for Ukraine defense

Instruments for EU defense bonds without need of unanimous vote, without PM Orban and others – to support Estonian plan

Estonian plan banner  10 x 12 m during event in Prague, April 21st 2024 - picture taken by White Charles.
Estonian plan banner during event in Prague, April 21st 2024 – by White Charles.

Estonian plan (see our campaign for strategy proposed by Estonia 120 billion plan) proposed every year to add over 100 billion eur for defense of Ukraine and therefore start imposing attrition and economically unbearable barrier to russian aggression.

Estonia, France and others (as described in our analysis of Estonian plan) are proposing joint debt scheme.

How to make Estonian plan happen by EU joint debt for defense of Ukraine

But the question is, how to realise strategy of eurobonds or other tools for defense of Europe, for Ukraine. Two options were considered in the backup plan B drafted in January 2024 after blockage of 50 billion EU Ukraine assistance (budget assistance, not for defense) by Viktor Orbán.

These tools are described by Euronews article – EU will approve 50 billion for Ukraine with our without Hungary.

And detail is described by Financial times: EU readies €20bn plan B to fund Ukraine. Debt-based scheme would sidestep Hungary to quickly release money for Kyiv. Main thesis from the article and other research are following:

First option – joint debt by EU with guarantees by majority of EU countries

  • The debt will be guaranteed by a group of EU countries, it is enough to be approved by the countries with the highest credit rating.
  • This was proposed for EU joint debt (so asked by EU Commission, with the most favourable conditions) in the budget. And for some countries giving such guarantee (Germany, the Netherlands) it would need to be approved by their parliaments.
  • This solution would be limited to loans for Ukraine and not include grants. 
  • But weapons cannot be purchased directly from the EU budget (according to interpretation of bloc treaties – see the next link below), so it must be a fund outside the budget – such as the European peace facility (and Ukraine assistance fund inside the EPF)
  • This fund is also the one supposed to be increased by income from Russian frozen assets windfall profits and unanimity is sought there. It is decided that 10% should go elsewhere than on weapons, so that a few countries can say that they do not spend it on weapons (Hungary, Austria) as described: 
  • The main question – would it be possible to increase the EPF with loans guaranteed by the majority of the country – without unanimity? Or create another fund without the need of unanimity? Certainly there are ways how to proceed but details are beyond the scope of this small research.

More about EPF european peace facility UAF Ukraine assistance fund please find in following links:

Related topic, more about talks regarding joint debt you can find in the following news link:

Second option: cheap loans by EU for Ukraine

Another option would be extension of cheap loans instruments. This option would need agreement of weighted majority of countries.

More about this option to be analysed, some details about cheap loans so far can be found here: 

Another option – European stability mechanism (422 billion euro) to be used for defense cheap loans for Europe

Update: Politico informed about discussions for using eurozone European stability mechanism (ESM) for european defense.

This fund was created at the peak of debt crisis and long term not used. Now, there are discussions to repurpose it for cheap loans for defense. Agreement for that would need to be reached among 20 eurozone leaders.

Related topic – NATO 100 billion defense fund – proposed military fund by Jens Stoltenberg – for Ukraine

This would be 100 billion euro for several years.

NATO allies agreed on Wednesday to initiate planning on long-term military support for Ukraine, but a proposal by NATO Secretary General Jens Stoltenberg to do so via a 100 billion-euro ($107 billion) five-year fund drew mixed responses.


There are ways to efficiently increase military aid for Ukraine – by sending every year tens of billions euro extra. All this is possible with bypassing some blocking countries when using some alternative options described – although it is beyond this small open source research to explore exactly how such plan can be executed. European commission was tasked to prepare main options for June european councíl summit ( ). If decided, that would be major contribution to Estonian plan (120B eur extra for defense of Ukraine to impose attrition and stop the russian war).

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