Giorgia Meloni Shakes Up EU Summit, Delays Ukraine Loan Plan and Mercosur Deal

Italian Prime Minister Giorgia Meloni Challenges the EU Status Quo

What began as a routine end-of-year summit in Brussels turned into a political shake-up that few saw coming. Italian Prime Minister Giorgia Meloni took centre stage, blocking two of the European Union’s most anticipated agreements — a new EU loan for Ukraine and the signing of the long-awaited EU–Mercosur trade deal.

Her move underscored the growing influence of Europe’s right-wing leaders, who are eager to challenge what they see as bureaucratic overreach from Brussels. After nearly 17 hours of tense negotiations, EU leaders were forced to hit pause on both key initiatives.

Ukraine Financing Faces a Last-Minute Overhaul

One of the summit’s main goals was to secure long-term funding for Ukraine. Initially, the European Commission proposed leveraging €185 billion in frozen Russian assets held at Euroclear, a financial institution based in Belgium.

However, Belgian Prime Minister Bart De Wever refused to support what he called a “risky legal shortcut”, insisting on stronger guarantees. Italy sided with Belgium, with Meloni’s government submitting a formal letter backing De Wever’s stance.

The New Funding Plan

The compromise reached in the early hours of Friday morning will see the EU issue €90 billion in common debt, backed by the Union’s overall budget, to support Ukraine through 2026 and 2027.

Not all members are on board.

Hungary, Slovakia, and the Czech Republic opted out of the new financing mechanism.
The remaining 24 EU countries will proceed under an “enhanced cooperation” framework.

Meloni praised the outcome, saying it ensures “a solid legal and financial basis” for support, while De Wever hailed it as a victory for smaller nations. Meanwhile, German Chancellor Friedrich Merz — who strongly pushed the frozen-assets plan — had to concede defeat, highlighting a rare moment of resistance to the dominance of larger EU states.

Mercosur Trade Pact Pushed to 2026

Shortly before the financing deal was finalised, European Commission President Ursula von der Leyen announced another setback: the signing of the EU–Mercosur trade deal — linking Europe with Brazil, Argentina, Paraguay, and Uruguay — would be delayed until January.

The delay followed Meloni’s statement to Italy’s parliament that pushing the agreement now would be “premature,” citing concerns about the impact on European farmers and environmental protections.

Farmer Protests and Political Pressure

The EU–Mercosur pact has sparked outrage among European farmers, especially in France and Poland, over fears of unfair competition from South American agricultural imports. Protests erupted in Brussels as tractors blocked roads and demonstrators demanded stronger safeguards for local producers.

With Italy joining France, Austria, Poland, and Hungary, the five countries now represent a blocking minority sufficient to stall the agreement. The European Commission hopes to reconvene in January, possibly in Paraguay, to sign the treaty if new concessions can be reached.

Spanish Prime Minister Pedro Sánchez called for patience:

“We’ve been waiting for an agreement for 25 years; we can wait another month.”

Despite the setback, Von der Leyen remains optimistic that a “sufficient majority” will emerge to seal the deal early next year.

Why This Matters

Meloni’s assertive stance signals that Europe’s political dynamics are shifting. National interests are increasingly taking precedence over collective EU ambitions. Her interventions reflect a broader trend in European politics — the rising influence of nationalist and right-leaning governments seeking to redefine the balance of power in Brussels.

As the EU struggles to maintain unity on key foreign policy and trade issues, such disruptions could shape the Union’s direction for years to come.

Key Takeaways

Meloni and Belgium blocked plans to use frozen Russian assets for Ukraine aid.
The EU will issue €90 billion in joint debt instead.
Three countries — Hungary, Slovakia, and Czech Republic — opted out.
The EU–Mercosur deal has been delayed until January due to farmer protests and lingering opposition.
Meloni’s moves highlight a growing divide within the EU between national governments and Brussels’ leadership.