EU Weighs Utilizing Frozen Russian Assets for Ukraine Loan
BRUSSELSโฃ – European Union leaders are considering aโค plan to leverageโค the profits generated from frozen Russian assets to provide a considerable โขloan to Ukraine, a move intendedโ to bolster Kyiv’s โขfinancial stability and defence capabilities as the conflict with Russia continues. โคThe proposal, discussed at a recent EU summit, aims to avoid directly โseizing the assets โคthemselves – a move some fear could damageโ the euro’sโ credibility – while still utilizing โขtheir economic potential to support Ukraine.
The initiative comes asโ Ukraine faces ongoing economic strain due to the war and relies heavily on financial assistance from Western allies. Currently, interest โขearned on the frozen Russian assets is already โคfunding aโ loan program for ukraine organized by the Group of Seven nations, and this existing program would not be affected โขby the new plan.
Though, significantโ hurdlesโฃ remain. While the EU’s executive branchโ believes many member statesโ will support the idea,โข particularly given increased defense โคspending andโ existing debt burdens in countries like Franceโข and โคItaly, concerns persist. Belgium โคhas expressed reluctance โto โact withoutโ unified EU support, fearing it could become โa target for โRussia.
A keyโ point of contention is how the โขloanโ would โbe financed. Ideally, it would be incorporated into the EU’s โคnextโฃ long-term budget, โขbut Hungary’s history of vetoing EU support for Ukraine casts doubt โคon this possibility. National guarantees are an alternative, but France has indicated hesitancy.
French President Emmanuel โMacron cautiously welcomed the plan, emphasizing the need to “remain a โขplace that’s attractive and reliableโฆ That meansโ that when assetsโ are frozen, we respect international law.” Finland and Sweden jointly advocated for the loan,stating inโ a letter to EUโฃ counterparts that “Investing in Ukraine is an investment โคin European security as a whole,”โข and that โrepaymentโข should be contingent on Russia โproviding war reparations.
German โคChancellor Friedrich Merz has publicly urged swift action, arguing that leveraging the assets would “disrupt the Russian president’s cynical game ofโข buying time and โbring him to the negotiating โคtable.” Heโ stressed the loan should prioritize military support, a position that highlights differing viewsโฃ among EUโฃ members regarding the allocation of โฃfunds.
“still a lot of work to do,” a source โฃfamiliar with the discussions told reporters. “But if we don’t take those assets into account then it’s on our taxpayers, that’s โfor sure.”