UK MOVES TO JOIN 60 BILLION EURO EU DEFENCE LOAN SCHEME FOR UKRAINE

British Prime Minister Keir Starmer is preparing to commit the United Kingdom to a 60 billion euro European Union defence-loan scheme for Ukraine during his final week in office, according to the Financial Times. The move would deepen post-Brexit defence cooperation between Britain and the EU while giving British defence companies fuller access to contracts financed through the programme.

The Financial Times reported that the UK's financial contribution would be linked to the value of defence contracts awarded to British companies by Ukraine. Without British participation, UK companies would face a 35% value cap under the programme; joining the scheme would allow them to be paid in full for eligible contracts.

The plan is expected to be discussed during a UK-French-led summit in Paris, according to the Financial Times. Starmer is also due to join French President Emmanuel Macron for Bastille Day events, placing the loan agreement inside a wider effort to present renewed British cooperation with European allies on defence and Ukraine.

The proposed participation follows earlier discussions with European Commission President Ursula von der Leyen in May, the Financial Times reported. The loan scheme is part of Europe's broader attempt to sustain military support for Ukraine as the war continues and as European governments try to expand defence-industrial capacity.

The agreement would also mark a narrower success after a separate UK attempt to join a larger 150 billion euro EU defence fund failed over disagreement about access fees, according to the Financial Times. That earlier dispute showed the limits of the UK-EU defence reset, with both sides still negotiating how much access Britain should receive to EU-backed procurement programmes after Brexit.

For Ukraine, the immediate significance is procurement. A loan-backed programme can help finance weapons, ammunition and defence equipment at a time when Kyiv remains dependent on external support. For Britain, participation would give domestic defence firms a route into contracts that might otherwise be restricted or capped under EU programme rules.

The timing gives the move added political weight. The Financial Times reported that Starmer is expected to resign on July 20 and be succeeded by Andy Burnham, making the Ukraine loan commitment one of his final foreign-policy decisions.

The immediate questions are whether the final terms are approved, which British companies receive contracts, and whether the deal survives the transition to a new prime minister. The agreement would not settle every UK-EU defence dispute, but it would give Britain a defined role in one major European financing channel for Ukraine's war effort.

Fact-check date: 11 July 2026
Article type: News
Sources: Financial Times