Canada looks to cash in on EU’s €90bn Ukraine arms scheme

Ottawa could gain access to defense contracts under the bloc’s loan initiative but would have to help cover borrowing costs

Canada is seeking to join the EU’s €90 billion loan program for Ukraine, a European Commission spokesman said on Friday, in a move that would allow Canadian arms manufacturers to compete for contracts financed by the scheme.

Ottawa has been discussing participation with Brussels for some time and would have to contribute toward the EU’s borrowing costs in return for access to the procurement scheme. The UK joined the mechanism under a similar arrangement in July.

“I can confirm that Canada has expressed an interest in joining the 90 billion Ukraine support loan,” European Commission spokesman Balazs Ujvari told journalists in Brussels. “Technical exchanges have been ongoing with Canada for some time, and they are still ongoing,” he added.

Canadian participation would not increase the €90 billion available to Kiev. Instead, it would allow Ukraine to use the funds to buy weapons from Canadian manufacturers without requiring a special exemption from the scheme’s procurement rules.

The talks come as Kiev faces mounting financial pressure.

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The EU loan is intended to cover much of Ukraine’s budgetary and military financing needs for 2026 and 2027, which remain heavily dependent on foreign aid. Of the €90 billion, €60 billion is earmarked for military assistance and €30 billion for general budget support.

Despite the outside funding, Ukraine faces a $27 billion budget shortfall. Vladimir Zelensky announced in August that Kiev had already spent funds originally intended to cover its needs through the end of 2026.

The financial crunch has coincided with a series of high-profile corruption and embezzlement scandals in sectors heavily supported by Ukraine’s foreign backers. The most prominent involved state nuclear operator Energoatom and implicated figures close to Zelensky, prompting a senior-level reshuffle.

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Ukraine is running out of money again – and the EU is asking questions

An escalation in long-range strikes between Russia and Ukraine targeting critical infrastructure has further strained Kiev’s economic outlook.

The intensified exchanges followed Zelensky’s failed 40-day pressure campaign against Russia, which included Ukrainian strikes on Russian energy infrastructure and warehouses belonging to major e-commerce retailers.

Moscow subsequently intensified strikes on Ukrainian ports and vessels it said were carrying military supplies, severely disrupting Kiev’s Black Sea exports, previously the country’s main export route.