LUXEMBOURG, June 26 (Reuters) – EU countries on Monday agreed to increase the maximum size of a fund used to finance military aid for Ukraine by 3.5 billion euros ($3.8 billion) to 12 billion.
The European Peace Facility (EPF), which EU countries contribute to according to the size of their economies, has already allocated some 4.6 billion euros in military aid for Ukraine. It is separate from the EU’s budget, which is not allowed to finance military operations.
“Today’s decision will again ensure that we have the funding to continue delivering concrete military support to our partners’ armed forces,” the bloc’s top diplomat Josep Borrell, who had requested the increase, said in a statement.
“The facility has proven its worth. It has completely changed the way we support our partners on defence. It makes the EU and its partners stronger,” he said.
Hungary on Monday said it would not lift a block on a 500 million euro tranche of the existing fund 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”.
Foreign Minister Peter Szijjarto, speaking in Luxembourg, said that Budapest was ready to change its mind if Ukraine dropped the blacklisting.
The EPF, 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 allows EU countries that supply weapons and ammunition to Ukraine and claim back a portion of the cost.
($1 = 0.9161 euros)
Reporting by Bart Meijer, Andrew Gray and Boldizsar Gyori; Editing by Toby Chopra and Conor Humphries
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