Merz Threatens to Block EU Budget Unless Member States Agree to Ukraine Funding

“What the chancellor is doing is typical blackmail, and I will not give in to it,” Slovakia’s prime minister, Robert Fico, told reporters in Bratislava.

German Chancellor Friedrich Merz has signaled he will block the European Union’s seven-year budget unless there is a deal on financial aid for Ukraine, theguardian.com reported.

The intervention by Berlin has angered central European leaders who are net beneficiaries of EU funds. Those nations refuse to participate in upcoming funding rounds to support Ukraine’s defense against the Russian invasion.

Fico spoke alongside Czech Prime Minister Andrej Babiš, whose populist government also rejects participation in future loans for Ukraine.

“I do not know why he is saying it,” Babiš said, referring to the position taken by Merz, according to theguardian.com.

Merz wrote a letter to European Council President António Costa outlining his demands ahead of an upcoming EU summit. The German leader stated that a collective commitment without exception is an essential prerequisite for resolving Ukraine’s funding shortfall.

Germany, the largest net contributor to the EU budget, wants steep cuts in the proposed framework while opposing generous funding for member states that refuse to contribute to Ukraine.

Last year, the EU agreed to lend €90bn to cover two-thirds of Kyiv’s civilian and military costs for 2026 and 2027. Slovakia, the Czech Republic, and Hungary opted out of that loan program.

Russian bombardment has added heavy costs, prompting President Volodymyr Zelenskyy to request €70bn to fill a budget shortfall. The EU has endorsed those figures and pledged to find €45bn.

Hungary, Slovakia, and Czechia have now been joined by Bulgaria, following the election of Moscow-friendly Prime Minister Rumen Radev last April, unn.ua reported.

Merz previously attempted to use €210bn in frozen Russian sovereign wealth funds held in the EU, but the plan was scuppered by opposition led by Belgium. Berlin is now seeking to switch EU funding votes to a qualified-majority system to prevent single-nation vetoes.

A spokesperson for Costa confirmed receipt of the German letter and stated that Ukraine financing will be addressed at an informal European Council meeting in Dublin, followed by a special summit dedicated to the EU budget on November 26-27, 2026.

Costa aims to secure a budget agreement before the end of the year. Upcoming elections in France, Poland, and Italy in 2027 are expected to complicate future negotiations.

“We must respond to blackmail,” Fico said, emphasizing that Slovakia retains the same veto right as the German chancellor, according to unn.ua.

Babiš noted that blocking the EU budget would ultimately halt funds directed toward Ukraine as well.