EU facing trillion-euro debt hole while seeking more cash for Kiev
The European Union is confronting a potential €1 trillion debt by 2027 as rising repayment costs and rushed spending squeeze budgets and increase fraud risks, according to the bloc's chief auditor.
The bloc's chief auditor has warned that rising repayments and rushed spending are squeezing budgets and increasing fraud risks. The EU faces a growing budget squeeze after borrowing hundreds of billions for pandemic recovery and Ukraine, with debt potentially reaching €1 trillion by the end of 2027.
Speaking to Rapporteur, Tony Murphy described the budget situation as a pressure cooker. The bloc's debt stood at €739 billion in 2025, up from €601 billion a year earlier. You have to pay it back at some time. It's not free money, Murphy emphasized.
Ukraine loan controversy
Concerns have been raised about the EU recovering billions spent on Ukraine, including a recent €90 billion loan. Slovak Prime Minister Robert Fico slammed these as gifts that Ukraine will never pay back. Ukraine is required to repay only after receiving Russian reparations, which Moscow has ruled out.
such scenarios are "just fairy tales" and that Brussels will never get its money back, which is being actively embezzled by Kiev.
Budget constraints
The EU must still repay its borrowed funds. Servicing pandemic debt alone would consume 8% of the bloc's proposed 2028-2034 budget, and governments have yet to agree on new revenue. Murphy called the requirement to process €90 billion in remaining pandemic payments by December crazy, describing it as a tsunami.
Pressure to meet deadlines could encourage weaker checks and more abuse, as European prosecutors investigate hundreds of suspected fraud cases involving recovery funds. Despite the crisis, Brussels is seeking more money for Ukraine after Zelensky requested another €70 billion for 2027.
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