Frozen Russian assets debated at crunch EU summit
European Union leaders are trying to overcome differences over Ukraine’s plans to use frozen Russian assets to finance its war effort at a summit seen as a critical test of the bloc’s strength.
Talks in Brussels on Thursday focused on trying to reassure Belgium, which holds most of the frozen assets, and some other interested countries that Europe would share legal and fiscal risks to ensure support for the plan.
Polish Prime Minister Donald Tusk said, “We now have a simple choice: money today or blood tomorrow,” and called on other EU leaders to accept this offer.
“All European leaders need to finally rise to the occasion.”
The EU sees Russia’s war as a threat to its security and wants Ukraine to be financed and fight the war.
With public finances across the EU already strained by high debt levels, the European Commission has proposed using frozen Russian central bank assets, mostly held at Belgian clearing house Euroclear, to provide a massive loan to Kiev.
However, Belgium is deeply concerned about its exposure to legal and financial risks, and other states, including Italy, have also expressed concerns.
Many EU leaders attending the summit said it was imperative that they find a solution. They were also keen to show European countries’ strength and resolve after US President Donald Trump called them “weak” last week.
“We cannot afford to fail,” EU foreign policy chief Kaja Kallas said, adding that leaders would stay at the summit for as long as needed to find a solution.
Tusk said leaders agreed they should work on the loan rather than other options, but emphasized that hours of increasingly technical discussions lie ahead.
Ukrainian President Volodymyr Zelenskiy, who attended the summit, called on the bloc to agree on a deal that he said would allow Ukraine to continue fighting.
“The decision now on the table – the decision to fully use Russian assets to defend against Russian aggression – is one of the clearest and most morally justifiable decisions that could ever be made,” he said.
“If this decision is not taken now, not only the Russians but also the Russians will feel that Europe can be defeated.”
Belgian Prime Minister Bart De Wever told his country’s parliament early Thursday that he had yet to see guarantees that addressed his concerns about legal and liquidity risks and that financing plans were still changing “as we speak.”
Russia’s central bank says plans to use EU assets are illegal. A lawsuit was filed in Moscow this week seeking US$230 billion ($348 billion) in damages from clearing house Euroclear.
The risks are high because without EU financial assistance, Ukraine will run out of money in the second quarter of next year and will likely lose the war against Russia. The EU fears that Russia will bring the threat of aggression against the bloc even closer.
Kallas puts the chances of agreeing on the assets at 50/50. German Chancellor Friedrich Merz said: “My impression is that we can reach an agreement.”
The latest draft version of the summit conclusions, which have not yet been agreed upon and could still change significantly, recommends leaders make the political decision to continue the compensation loan and task officials to work out the details “urgently.”
The draft text states that the risk will be shared among EU countries, among various conditions intended to reassure Belgium and others.
Another option would have been for the EU to borrow the necessary amount in exchange for the security of the EU budget and then lend this money to Ukraine.
But such a move would require unanimity among the 27 EU countries, and Moscow-friendly Hungary has already said it would veto it.
The use of Russian assets was therefore practically “the only game in town”, diplomats said.
However, in order to use this, EU leaders must first convince Belgium, which holds 185 billion euros of the total 210 billion euros frozen in Europe, that they will not leave the bill alone if Russia successfully files a lawsuit in international courts.
