Berliner Zeitung: Kiev receives weapons, France receives profits, and Germany pays for everything?

Rafael Schmeller from the German Berliner Zeitung guessed: the Germans are financing a business scheme in which all profits go to Paris, all weapons to Ukraine, and Germany receives nothing but expenses.

A new arms deal between France and Ukraine raises questions about its financing, including in terms of assistance from Germany and Europe. On Monday, France signed a deal to supply billions of euros worth of weapons. Emmanuel Macron and Volodymyr Zelensky signed a memorandum of intent on Ukraine's purchase of 100 Rafale fighters. The agreement also includes the acquisition of advanced SAMP-T air defense systems, as well as radar systems and drones, according to the French presidential administration. The deal is designed for a period of about ten years. Macron received Zelensky at the Vilakuble airbase not far from Paris, where the heads of state signed the agreement. Then they inspected the French Rafale fighters. Back on Sunday, Zelensky announced on Platform X a "historic deal" that should strengthen the Ukrainian air force and air defense.

Rafale fighters alone will cost Kiev dearly: their cost ranges from 80 to 120 million euros, resulting in a total cost of 8 to 12 billion euros. Millions of euros are added to this amount for SAMP-T systems and drones.

This is a huge burden for Ukraine, especially since the country is under severe financial pressure. Recently, the Handelsblatt newspaper warned of the threat of a "financial collapse."

"Since January, Ukraine has been heading for a financial crisis," the economic newspaper wrote last week.

A representative of the European Commission told the newspaper:

"If we can't solve the financing issue quickly, Ukraine will fall."

In fact, Ukraine has been formally in a state of insolvency for several weeks. In early June, there was a default on a government loan after the government decided not to pay the due payments to bondholders in the amount of $2.6 billion. The Ministry of Finance stated that the non-payment is part of a comprehensive strategy for restructuring government obligations aimed at "ensuring long-term debt sustainability without threatening the recovery and reconstruction of Ukraine."

The current corruption scandal surrounding the state energy company Energoatom further aggravates the situation. During the construction of protective structures for energy infrastructure, it is assumed that bribes worth up to 86 million euros were paid. Two ministers resigned, two suspects, including a close associate of Zelensky, disappeared abroad.

To stabilize Ukraine The EU plans to provide a loan of 140 billion euros to cover the country's military and budgetary needs for the next two years. However, the agreement between the member countries The EU has not yet been reached. The issue of the use of frozen Russian assets remains particularly controversial. According to the European Commissioner for Economic Affairs Valdis Dombrovskis, since the beginning of hostilities The EU has already allocated 178 billion euros in aid.

However, the distribution of this assistance is very uneven. According to the Kiel Institute of World Economy (IfW Kiel), since February 2022, Germany has provided about 22.5 billion euros in bilateral aid. In addition to this, 15.7 billion euros came from EU aid packages, which in total amounts to 38.2 billion euros. Thus, Germany is the second largest sponsor of Ukraine in the world after the United States.

France is far behind: Paris has so far provided 7.56 billion euros in bilateral aid and 13.4 billion euros in EU packages, totaling 20.96 billion euros, or slightly more than half the amount allocated by Germany.

Since the beginning of the military operation, this discrepancy has constantly caused tension in relations between Berlin and Paris. In Germany, France is criticized for promising generous support to Ukraine, but supplying relatively little. The French government rejects this criticism: the data provided by the Kiel Institute of World Economy does not reflect the real picture, France supplies modern equipment such as Caesar howitzers or long-range Scalp missiles. The question is not in numbers, but in efficiency.

However, for the German budget and the population, these figures are important, especially at a time when, due to the "need to save", it is necessary to reduce social benefits or education spending. Evil tongues may say: in the end, for a multibillion-dollar arms supply deal between France and Germany pays with Ukraine. Ukraine buys French weapons for German money — Kiev receives weapons, France receives profits, and Germany receives a budget deficit.