US and EU struggle to agree on funding for Ukraine | Russia-Ukraine war News


Uncertainty is growing over Western backing for Ukraine amid Russia’s intensifying campaign to knock out the country’s energy infrastructure.

The White House has warned the United States Congress that funds designated for providing aid to Ukraine would run out by the end of the year, in a letter made public on Monday. The European Union is also facing difficulties in agreeing on a new 50 billion euro ($54bn) lifeline for Kyiv.

“I want to be clear: without congressional action, by the end of the year we will run out of resources to procure more weapons and equipment for Ukraine,” the director of the US Office of Management and Budget, Shalanda Young, wrote in a letter to House Speaker Mike Johnson.

In the face of an upcoming harsh winter of intensifying Russian assaults on civilian infrastructure, the lack of funding could mean defeat for Ukraine, warned the budget director. “If Ukraine’s economy collapses, they will not be able to keep fighting, full stop,” she wrote.

The US narrowly averted a government shutdown last month, with a last-minute bill keeping federal agencies funded through the new year, but leaving out key foreign aid initiatives.

The US, Ukraine’s biggest single-country donor, has sent more than $40bn in aid since Russia’s invasion in February 2022. In October, US President Joe Biden asked Congress to approve $105bn in national security funding, which would include support for Ukraine.

But right-wing congressional Republicans have expressed increasing scepticism towards approving more funds for Ukraine and some $61bn in additional aid funds are now being held up by the US Congress.

“There is no magical pot of funding available to meet this moment. We are out of money – and nearly out of time,” Young wrote, urging Congress to act “now”.

‘Existential moment’

At the same time, the EU is struggling to pass its own funding package, which would be part of the bloc’s future joint budget.

Hungary has led arguments against the package. Prime Minister Viktor Orban has ploughed a pro-Russian furrow since Moscow’s invasion. He is also thought to be hoping to use his threat to block the plan to try to unfreeze 22 billion euros ($24bn) in funding for Budapest that Brussels is holding due to rule-of-law issues.

The victory of the far-right in the recent Netherlands election and fiscal challenges in Germany are also complicating negotiations over the budget, the Financial Times reported on Sunday.

The delay is endangering crucial pledges to Kyiv made months ago. A budget agreement would be “very, very difficult”, a senior official said.

The 50 billion euro ($54bn) instrument proposed is designed to keep Kyiv solvent to 2027. A failure to approve long-term funding, as well as a separate 20 billion euro ($22bn) facility for weapons purchases, would hit Kyiv hard as the war grinds on.

Olha Stefanishyna, Ukraine’s deputy prime minister for European and Euro-Atlantic integration, last week described the EU summit as an “existential moment” for her country.

Energy as a weapon

The difficulties in securing the funds in Washington and Brussels have raised concerns in Kyiv that Western backers are experiencing “fatigue” with the drawn-out battle as fighting on the front line becomes bogged down in what some see as a “stalemate“.

As Russia continues its campaign targeting civilians and infrastructure in indiscriminate bombings and drone attacks, Ukraine announced a 450 million euro ($489m) expansion of a wind farm in its Mykolaiv region on Monday at the United Nations COP28 climate talks.

Ukrainian officials highlighted how its turbines would be spread far enough apart to survive any Russian missile attacks.

Also speaking at the climate summit, US Assistant Secretary of State for Energy Resources Geoffrey R Pyatt denounced Russia’s targeting of energy infrastructure in the war, saying that Russian President Vladimir Putin “has made energy one of his weapons”.

Pyatt, a former US ambassador to Ukraine, said that Putin has “done that with his drone and missile attacks on civilian energy infrastructure. He’s done that by turning off the gas pipelines in order to try to weaken Europe’s resolve to support the Ukrainians…”

“For Vladimir Putin, energy is just about as much a part of his war strategy as are his tanks and his missiles,” he said.

Russia has spent recent weeks launching dozens of attack drones and missiles at Ukraine in overnight raids targeting energy facilities and military sites.

Ukraine’s air force said on Monday that it had shot down 18 out of 23 Iranian-made Shahed drones and one missile.

Meanwhile, Russia was reported to have intensified attacks from new directions on the industrial town of Avdiivka on Monday.

“The launching of new directions proves that the enemy has been given a command to capture the city at any cost,” Ukrainian officials said.


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