Biden administration informs Congress it will forgive $5B in economic loans to Ukraine

The Biden administration has announced plans to cancel $4.65 billion in debt owed by Ukraine, marking a significant move to support the country in the midst of its ongoing conflict with Russia. This decision comes as part of a larger economic aid package that was passed by Congress earlier this year.

State Department spokesperson Matthew Miller confirmed the plans during a briefing, stating that the administration was following the provisions outlined in the law to cancel the loans and provide economic assistance to Ukraine. The funding package, which included $60 billion in aid for Ukraine, allocated $9 billion as a loan with the provision for forgiveness.

While Congress could potentially pass a resolution to overturn the cancellation, it is unlikely to succeed in the Democratic-controlled Senate. President Biden also has the power to veto any such resolution. The funding package allowed for the forgiveness of 50% of the loan immediately, with the remaining 50% eligible for forgiveness after January 2026.

However, not everyone is in agreement with the administration’s decision. Rep. Thomas Massie and Sen. Rand Paul, both Republicans from Kentucky, have introduced resolutions to block the measure. They argue that forgiving Ukraine’s debt is not in the best interest of American taxpayers.

President Biden has been ramping up support for Ukraine in recent weeks, authorizing the use of U.S.-provided long-range missiles and anti-personnel land mines. This move comes as Russia has reportedly brought in 10,000 troops from North Korea to fight in the conflict.

In addition to canceling the debt, Biden has pledged to commit the remaining $7 billion from the aid package to Ukraine before leaving office. This includes $275 million for additional military support, such as drones, artillery ammunition, and mortars. The administration has also approved U.S. military contractors to assist Ukraine in maintaining and repairing U.S.-made weapons systems.

As the conflict in Ukraine continues to escalate, the Biden administration’s actions have drawn both praise and criticism. While some view the support for Ukraine as long overdue, others accuse Biden of escalating the conflict for political reasons. It remains to be seen how President-elect Donald Trump will handle the situation once he takes office, as he has expressed confidence in his ability to negotiate an end to the war with Ukrainian President Volodymyr Zelenskyy and Russian President Vladimir Putin.