Shifting the Burden: Europe is currently managing to replace US financial aid to Ukraine, but a new model for military supplies still needs to be worked out

By sharply increasing aid to Ukraine at the start of 2025, Europe has managed to compensate for the lack of new support from the United States – at least in financial terms. Between January and April, total assistance amounted to €27.4 billion, only slightly below the average for all four-month periods since May 2022 (€28.3 billion). Europe accounted for 98% of this sum, whereas over the previous three years, its share stood at 53%.

For Ukraine’s position to become more stable, all European countries would need to spend at least 0.37% of their GDP, or 0.2% of GDP in purchasing power parity terms. on supporting it, according to calculations by the Kiel Institute for the World Economy. So far, only the countries of Northern Europe and the Baltics have reached this threshold. The largest economies, the European 'big five', are lagging behind. This year, the UK and France have begun increasing their spending, and Germany has made pledges. Italy and Spain, however, are limiting themselves to symbolic amounts and their contribution to European aid for Ukraine is negligible in relation to the size of their economies.

It remains unclear whether Europe will be able to consolidate the gains made at the beginning of 2025. To make the aid mechanism more sustainable, there should be broader use of frozen Russian assets. A compromise is currently under discussion: investing these assets in less conservative financial instruments in order to finance a new loan for Ukraine from the higher returns.

Meanwhile, Ukraine continues to receive part of the deliveries of American weapons agreed upon during Joe Biden’s presidency, for which Europe has no equivalents. Orders have already been placed but not yet fulfilled. These supplies are expected to continue until spring 2028, unless Donald Trump attempts to halt them, citing emergency powers.

Finally, in recent weeks, the first steps have been taken towards implementing a new scheme for the delivery of American arms, via a so-called 'mineral deal' mechanism. However, it is unlikely that this mechanism will reach the scale required to meet Ukraine’s military needs in the foreseeable future. One way to make up for the shortfall could be a scheme under which European countries resell American arms to Ukraine.

Aid tracker: Europe replaces the US

In recent months, Europe has significantly increased its support for Ukraine and has managed to compensate for the absence of new aid packages from the United States, at least in financial terms. According to data from the Ukraine Support Tracker project by the Kiel Institute for the World Economy (IfW), the average monthly aid volumes from January to April 2025 even slightly exceeded the levels seen in 2022–2024, when the US and Europe were providing Ukraine with roughly equal support.

In March and April alone, Ukraine received €10.4 billion in military aid and €9.8 billion in humanitarian and financial aid, according to these estimates. These are the largest volumes recorded for any two-month period since the beginning of Russia’s invasion.

Overall, between January and April, total aid reached €27.4 billion, only marginally below the average for all four-month periods since May 2022 (€28.3 billion). Europe accounted for 98% of the latest sum, compared to 53% over the previous three years.

American and European aid to Ukraine, 2022–2025, billion euros

This marks an important and novel development in the dynamics of international support for Ukraine. Until recently, Europe’s ability to replace American aid was met with considerable scepticism (→ Re: Russia: The Price of the Moment). Researchers behind the Ukraine Support Tracker had noted that, in the long term, this would require a significant increase in contributions from the region’s largest economies (Germany, the United Kingdom, France, Italy, and Spain), whose spending, in relative terms, had so far lagged well behind the European average.

Over the first three years of the war, Ukraine received an average of €82 billion annually, of which roughly half (around €40 billion) was military assistance. Thus, the total volume of international aid Ukraine requires is estimated at around 0.37% of the GDP of 'Greater Europe' (the EU, UK, and Norway), or 0.21% of GDP in purchasing power parity (PPP) terms, according to experts at the Kiel Institute (PPP calculations help to offset price level differences between European countries). While some states, notably Denmark, the Netherlands, Sweden, and the Baltic countries, had from the outset allocated more than 0.2% of their GDP in PPP terms, the 'big five' economies contributed far less: Germany – 0.13%, the UK – 0.16%, France – 0.05%, Italy – 0.04%, and Spain – 0.03%.

EU institutions played a key role in the first four months of 2025, providing €12.2 billion, just over 45% of the total. Among major European countries, the UK made the most prominent contribution, allocating €4.5 billion since the beginning of the year. France committed €2.2 billion. For both countries, these are significant sums. Since the start of the war, including these packages, the UK has allocated a total of €19.27 billion, while France has provided €7.36 billion. The Nordic countries also played an important part in replacing American assistance, contributing €5.8 billion from January to April. At the same time, Germany drastically reduced its aid at the start of the year: between January and April, it provided just €650 million, 70% less than over the same period last year. However, a significant contribution from Berlin is expected in the coming months: Ukraine is due to receive €9 billion in military assistance alone from Germany, Defence Minister Boris Pistorius said at the end of May. At the same time, Spain and Italy spent symbolic amounts on aid to Ukraine in January–April, €10 million and €20 million, respectively, and since the start of the war, their total aid has amounted to €1.47 billion and €2.28 billion, respectively, which is clearly not commensurate with the political role that Italy, for example, claims to play in European affairs.

Experts at the Kiel Institute caution that it remains uncertain whether the current surge in aid from Europe is a temporary episode or the beginning of a lasting trend. The situation would appear more stable if progress were made on the issue of frozen Russian assets. So far, income from these assets is being used to finance a $50 billion loan to Ukraine through the Extraordinary Revenue Acceleration (ERA) mechanism. This mechanism has played a positive role in supporting Ukraine’s financial stability (→ Re: Russia: Safety Margin), but it is not sufficient. According to Politico, a possible compromise solution is to transfer part of the frozen assets, roughly €200 billion of the total €260 billion, into a new, less conservative investment fund that would yield more generous returns. Last year, the yield on assets held in Belgium (€183 billion) was less than 1% (€1.7 billion), according to local media.

Continuation of US military aid: Biden's legacy and Trump's choice

Even so, the progress already made is encouraging, especially given that, despite the absence of new US aid packages and even public discussion on the matter, Ukraine continues to receive previously agreed assistance from Washington, and will do so for some time. According to estimates by the Centre for Strategic and International Studies (CSIS), in the first half of this year Ukraine has been receiving around $1 billion worth of American weaponry per month (about half the average monthly level provided by the US in previous years, per the Ukraine Support Tracker). Roughly similar levels – from $700 million to over $1 billion per month – are expected to continue for several more years. The CSIS analysis extends through to spring 2028, by which time preparations for the next US presidential election will already be underway.

These are mainly supplies agreed under the Ukraine Security Assistance Initiative (USAI), one of three mechanisms for US military aid to Ukraine. Under USAI, Kyiv has received nearly $32 billion. The two other mechanisms are the Presidential Drawdown Authority(PDA), which has provided $46 billion, and Foreign Military Financing (FMF), at $7 billion. PDA allows the US president to supply weapons without Congressional approval. FMF is a State Department programme through which US allies, including Ukraine, can purchase American weapons using funds provided by Washington. USAI, on the other hand, is run by the US Department of Defense, which procures arms from American companies for transfer to Ukraine. In contrast to FMF, where Ukraine itself selected what to buy, under USAI, decisions about the content of shipments are made by the US military.

Unlike the other two mechanisms, which allow for more or less rapid deliveries, including from warehouses, the USAI involves long implementation periods.According to CSIS experts, it takes the US government an average of four months to finalise contracts, then around 24 months for manufacturers to produce the first batch, and a further 20 months or so to complete the deliveries. For instance, about a dozen HIMARS multiple launch rocket systems and an equal number of NASAMS air defence systems, ordered as far back as 2022, are only now expected to reach the front lines. According to the centre’s data, Ukraine will receive its final shipments under the PDA mechanism in August 2025. After that, deliveries will continue solely via USAI. No further shipments are expected through FMF.

In theory, USAI deliveries could be halted if Donald Trump decides to ‘apply pressure’ on Ukraine to force it into a Kremlin-favoured peace settlement. While the weapons in question are, in formal terms, already Ukraine’s property, Trump could potentially redirect them to the US military, citing a national emergency. This provision is allowed under the Defence Production Act. In fact, a precedent has already been set: in early June, according to The Wall Street Journal, Defence Secretary Pete Hegseth diverted a shipment of fuses for surface-to-air missiles, used by the Ukrainian armed forces to combat Russian drones, citing urgent need by US forces in the Middle East. This move can also be interpreted in the context of US preparations for an Israeli operation against Iran. The fuses were to be supplied under USAI. However, CSIS experts believe it is unlikely that Trump will pursue such a course. First, such a decision would require solid justification and could be legally challenged. Second, Trump’s recent actions suggest a preference for maintaining a minimal level of support for Ukraine, rather than ending it outright.

As we have previously written, the so-called mineral deal between Kyiv and Washington allows new arms deliveries and military aid to Ukraine to be counted as US contributions to a joint investment fund (→ Re: Russia: Sleeping Mineral Bomb). According to the Kyiv Post, on 30 April, Trump approved the first such deliveries worth $50 million. A State Department representative, when contacted by Newsweek, neither confirmed nor denied the report. Meanwhile, according to The New York Times,the Ukrainian government is preparing its first tender under the deal for the development of a lithium deposit. Both sides are thus working to activate the deal, specifically with a view to enhancing Ukraine’s security. However, it is unlikely that this mechanism can be scaled up to meet Ukraine’s full military needs in the foreseeable future.

According to Reuters, President Volodymyr Zelensky had hoped to negotiate a larger arms deal with Trump at the G7 summit in Canada, but was unsuccessful. The next opportunity will be the upcoming NATO summit next week. Yet even there, a breakthrough seems improbable. More likely is a scenario in which, should the US choose to exert greater pressure on Putin or to stabilise relations with its European allies, European countries might purchase American weapons and then transfer them (or the equivalent of previously purchased systems) to Ukraine. Thus, options for sustaining military support to Ukraine remain viable, even if Donald Trump does not intend to approve new aid packages through the mechanisms used by the previous administration.