EU Faces Internal Division Over funding Ukraine with Russian Assets
The European Union is grappling with internal disagreements over a proposal to utilize frozen Russian assets to finance Ukraine’s reconstruction, as a key deadline for agreement approaches at the December EU leaders’ summit. The debate is further complicated by a recently surfaced US-Russia peace plan draft and a corruption scandal in Kyiv.
The core of the dispute centers on conditions attached to the proposed “reparations loan.” While European Commission President Ursula von der Leyen champions the plan as a means to “make Russia pay” for the war in Ukraine and insists European taxpayers will not bear the financial burden, Belgian Prime minister Jan De Wever has voiced strong opposition. De Wever argues that if Russia is not definitively deemed the “losing party” in the conflict, it could reclaim its sovereign property currently under sanctions. He warns that such a scenario would collapse the reparations loan, leaving European taxpayers responsible for the funding.
This position sharply contrasts with that of other EU leaders, like German Chancellor friedrich Merz, who view the frozen Russian assets as crucial leverage in negotiations with Moscow.Merz emphasized the need for a swift agreement to bolster the EU’s negotiating position and demonstrate solidarity with Ukraine.
The debate was ignited further by the revelation of a secret US-Russia peace plan, initially proposing a controversial model that would have allowed both Washington and Moscow to benefit commercially from the Russian assets. While a provision enabling this has reportedly been removed following US-Ukraine talks, the plan underscored the value of the assets and prompted renewed consideration among EU members.
Adding to the pressure, Russian President Vladimir Putin issued a warning against seizing the funds, labeling it “theft of someone else’s property” and threatening reciprocal measures. Under the EU proposal, Moscow would be allowed to recover the immobilized assets if it agreed to compensate Ukraine for war damages.
The timing of this debate is especially challenging for Ukraine, as it faces a spiraling corruption scandal that led to the resignation of Andriy Yermak, President Volodymyr zelensky’s chief of staff and key negotiator. Diplomats acknowledge the scandal presents a challenging optic for securing further European funding, though they maintain that aid should not be contingent on internal Ukrainian affairs.
The European Commission, initially criticized for downplaying De Wever’s concerns, is attempting to navigate the divisions. Commission spokesperson Paula Pinho acknowledged the legitimacy of the questions being raised and stated the Commission is working to address concerns.While not ruling out a qualified majority vote to override Belgium’s objections, Pinho indicated that such a step has not yet been considered.
