The EU will start arming Ukraine with money earned from Russian assets.

On June 24, EU countries approved the first tranche of military aid to Ukraine, about €1.4B, which will come from the proceeds of frozen Russian assets. The funds will be used to purchase equipment such as ammunition and air defense systems directly. A quarter of the amount will be used for purchases directly from the Ukrainian defense industry.

In his turn, EU chief diplomat Josep Borrell clarified at the beginning of the Luxembourg meeting that €2.5B will be allocated for weapons for Ukraine this year from the income from the Russian assets. The first part of the amount will be available next week.

The head of EU diplomacy also said that the EU has developed a legal way to bypass Hungary’s veto on the purchase of weapons for Ukraine with the proceeds from Russian assets. It could also clear the way for the G7 to extend Kyiv a $50B loan.

At the same time, the concern from the US and other G7 partners that Hungary could block the EU’s decision to freeze Russian assets has already led to significant delays in the loan negotiations.