The UK has announced a new £2.26 billion loan to Ukraine aimed at strengthening the country’s military capabilities in its ongoing defence against Russia’s invasion. The loan, part of the G7 Extraordinary Revenue Acceleration (ERA) scheme, forms Britain’s contribution to the $50 billion aid package agreed upon at the G7 Leaders’ Summit in Apulia, Italy, this past June.
The funds will be allocated to Ukraine’s military budget, allowing for the procurement of essential equipment such as air defence systems, artillery, and other vital resources needed on the frontlines. This new financial commitment adds to the UK’s existing £3 billion per year military aid and continues its extensive support since the conflict began.
Chancellor of the Exchequer Rachel Reeves, alongside Defence Secretary John Healey, made the announcement while visiting Ukrainian personnel being trained under Operation INTERFLEX in the UK. More than 45,000 Ukrainian soldiers have been trained in the UK, with the operation now extended until the end of 2025.
In a statement, Chancellor Rachel Reeves said, “Our support for Ukraine and her men and women in their fight for freedom from Putin’s aggression is unwavering and will remain so for as long as it takes. This new money is in Britain’s national interest because the frontline of our defence – the defence of our democracy and shared values – is in the Ukrainian trenches. A safe and secure Ukraine is a safe and secure United Kingdom.”
The loan is backed by the profits generated from immobilized Russian sovereign assets, a move that ensures Russia bears financial responsibility for its actions under international law. The UK government plans to introduce domestic legislation in the coming weeks to facilitate the rapid transfer of these funds to Ukraine.
UK’s Commitment to Ukraine
The UK’s £2.26 billion loan is a significant addition to the £12.8 billion it has already provided to Ukraine in military, economic, and humanitarian aid since the conflict began. The UK has supplied around 400 different types of military capabilities, including the recent pledge of 650 Lightweight Multirole Missile systems to strengthen Ukraine’s air defences.
Defence Secretary John Healey emphasized the strategic use of profits from sanctioned Russian assets, saying, “By using the money generated from these sanctioned Russian assets, we can help turn the tables on Putin’s war machine. This urgent funding will directly support Ukraine’s defence using the proceeds from assets that had helped fuel Putin’s aggression.”
Impact of Sanctions
The UK, alongside its international partners, has implemented the most comprehensive sanctions package ever imposed on a major economy, aiming to deplete Russia’s financial capacity for war. These sanctions have already prevented Russia from accessing over $400 billion, funds that could have extended its military campaign for another four years. The economic strain is evident, with Russia’s war efforts consuming 40% of its annual budget and resulting in the highest daily casualty rates since the conflict started.
The announcement comes just ahead of the Chancellor’s planned attendance at the International Monetary Fund (IMF) Annual Meetings in Washington D.C., where she will reaffirm the UK’s commitment to Ukraine on the global stage. Earlier this month, Prime Minister Keir Starmer hosted Ukrainian President Volodymyr Zelenskyy at Downing Street, reinforcing the UK’s ongoing support and collaboration on Ukraine’s victory plan.
A Clear Message to Aggressors
The UK government’s latest financial pledge sends a strong signal that it remains committed to standing with Ukraine for as long as necessary. The G7’s $50 billion ERA scheme, with contributions like the UK’s £2.26 billion loan, underscores the international community’s unified stance against aggression and the violation of sovereignty.
As the conflict continues, the UK’s swift response and ongoing support for Ukraine serve as a reminder that Britain is committed to upholding democracy, freedom, and international law.
