Ukraine’s Minister of Finance and the European Commissioner for Defense and Space discussed financial and defense cooperation

On September 15, Minister of Finance of Ukraine Sergii Marchenko held a meeting with European Union Commissioner for Defense and Space Andrius Kubilius.

The parties discussed EU financial initiatives to strengthen Ukraine’s defense capabilities, cooperation aimed at developing Europe’s military strength, as well as the challenges for Ukraine’s State Budget under conditions of full-scale war.

The Minister of Finance thanked the EU for its strategic support and close cooperation, and Andrius Kubilius for his leadership in developing the defense industry and implementing the SAFE program. Thanks to these efforts, Ukraine gains access to common EU instruments.

SAFE is a new EU financial initiative designed to support member states willing to invest in defense industrial production through joint procurement. SAFE will finance urgent and large-scale investments in European defense technologies and the industrial base.

Cooperation within SAFE is open to European Economic Area countries and to Ukraine. This includes both the possibility of joint procurement of military equipment and placing production orders with Ukrainian enterprises.

Sergii Marchenko emphasized the significant potential of Ukraine’s defense industry, which produces more than one thousand types of weapons, although about 40% of capacities remain unfunded. The SAFE program can help address this issue by ensuring joint financing of production, including in Ukraine.

Sergii Marchenko also highlighted the substantial contribution of the European Union to Ukraine’s budgetary support. Since the beginning of the full-scale war, Ukraine has received over EUR 58.5 billion.

“The consistent policy of the European Union, aimed at supporting Ukraine and collective security, is a crucial factor in achieving a just and lasting peace. I am grateful to the EU for its substantial assistance. We continue working together toward deeper integration of our defense capabilities,” Sergii Marchenko stressed during the meeting.

Andrius Kubilius confirmed readiness to expand cooperation in the defense industry, emphasizing that Ukraine is an integral part of European security.

The parties also reviewed initiatives of European Commission President Ursula von der Leyen, including the frontloading of EUR 6 billion under the ERA mechanism (funds from revenues of frozen russian assets) in 2025. These funding will cover urgent needs and drone production.

They also discussed the proposal for a Reparations Loans mechanism backed by frozen russian assets. Ukraine's Finance Minister noted that the need for external financing next year will remain significant given the likely continuation of active hostilities. Establishing new budgetary support initiatives for Ukraine and expanding existing ones is essential to maintaining Ukraine’s financial stability.

The meeting was also attended by Deputy Minister of Finance for European Integration Yuriy Draganchuk, Deputy Minister of Finance Olga Zykova, and Ambassador of the EU to Ukraine Katarína Mathernová.