🔗 Share this article Moscow Retaliates at Europe's Proposal to Lend Immobilized Russian Assets to Kyiv Kyiv remains running out of financial resources to maintain its armed forces and economy afloat, after nearly four years of full-scale conflict with Russia. In the view of European leaders, the solution to filling Kyiv's budget hole of €135.7bn for the following biennium rests with Moscow's immobilized funds held by Belgian bank Euroclear, and Brussels seek to give it the green light at their Brussels summit next week. Authorities in Russia state the EU plan would be an illegal seizure, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court ahead of a definitive agreement is made. 'Just' to Employ Russia's Assets, Argue European and Ukrainian Officials All told, Russia has roughly €210bn of its assets blocked in the EU, and €185bn of that is held by Euroclear. The EU and Ukraine contend that those funds should be used to restore what Russia has laid waste to: The European Commission terms it a "reparations loan" and has proposed a plan to prop up Ukraine's economy amounting to €90bn. "It is only just that Moscow's blocked funds should be used to reconstruct what Russia has destroyed – and that those funds then becomes Ukraine's," remarks Ukrainian President Volodymyr Zelensky. Chancellor Friedrich Merz states the assets will "enable Ukraine to protect itself effectively against any future Russian attacks". Russia's court action was foreseen in Brussels. But it is not only Moscow that is concerned. The Belgian government is worried it will be saddled with an massive bill if it all fails, and Euroclear chief executive Valérie Urbain argues using the assets could "undermine the world's financial order". Euroclear also has an estimated €16-17bn locked in Russia. Belgian Prime Minister Bart de Wever has presented the EU with a series of "pragmatic, fair, and legitimate conditions" before he will accept the reconstruction loan scheme, and he has not excluded legal action if it "presents significant risks" for his country. What is the EU's Proposal? Brussels is racing against time before next Thursday's summit to finalize a arrangement that Belgium can accept. Until now the EU has avoided touching the principal funds directly but since last year has paid the "excess income" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the profits is considered permissible as Russia is subject to sanctions and the returns are not Russian sovereign property. But international military aid for Ukraine has slipped dramatically in 2025, and Europe has had trouble trying to make up the deficit caused by the US decision to largely cease funding Ukraine under President Donald Trump. There are presently two EU options seeking to furnishing Ukraine with €90bn, to finance a majority of its budgetary necessities. Option one is to borrow the funds on the markets, guaranteed by the EU budget as a collateral. This is Belgium's first choice but it demands a unanimous vote by EU leaders and that would be difficult when two member states object to funding Ukraine's military. This makes the other option lending Ukraine cash from the Moscow's immobilized capital, which were initially held in financial instruments but have now mostly turned into cash. That funding is Euroclear property deposited at the European Central Bank. The European Commission recognizes Belgium has justified fears and claims it is confident it has addressed them. The scheme is for Belgium to be safeguarded with a guarantee covering all the €210bn of Russian assets in the EU. If Euroclear face a financial hit of its own assets in Russia, the loss would be compensated from assets belonging to Russia's own settlement agency which are in the EU. If Russia targeted Belgium itself, any judgment by a Russian court would not be accepted in the EU. In a key development, EU ambassadors are poised to endorse on Friday to immobilise Russia's central bank assets held in Europe indefinitely. Previously they have had to vote all together every six months to continue the freeze, which could have meant a repeated risk to Belgium. The EU ambassadors are set to use an special provision under Article 122 of the EU Treaties so the assets remain frozen as long as an "direct danger to the economic security of the union" continues. Why Belgium is Still Not Convinced Brussels is adamant it remains a strong supporter of Ukraine, but sees juridical dangers in the plan and worries about being forced to deal with the repercussions if things do not work out. A typically fractured political scene in this case has come together in support of Prime Minister Bart de Wever, who is under pressure from European colleagues. "Belgium is a small economy. Belgian GDP is approximately €565bn – think about if it would need to carry a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to obtain sufficient guarantees for the loan itself, Belgium is concerned about an additional danger of being vulnerable to extra damages or penalties. Prof Colaert also contends the demand for Euroclear to provide a loan to the EU would breach EU banking regulations. "Lenders need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is instructing Euroclear to do just that. "What is the purpose of these banking laws? It's because we want banks to be stable. And if things fail it would be up to Belgium to save Euroclear. That's another reason why it's so crucial for Belgium to obtain absolute guarantees for Euroclear." The European Union Under Pressure from All Sides The situation is urgent, caution a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They maintain the proposal to use Russian funds is "the most financially feasible and politically achievable solution". "This is a crucial test for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do afterwards. That's why we have to succeed in a week's time". Although Russia is unyielding its money should not be used, there are additional apprehensions among leaders in Europe that the US may want to deploy Russia's frozen billions in another way, as part of its own diplomatic proposal. Zelensky has indicated Ukraine is coordinating with Europe and the US on a rebuilding fund, but he is also cognizant the US has been talking to Russia about future co-operation. An early draft of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving
Kyiv remains running out of financial resources to maintain its armed forces and economy afloat, after nearly four years of full-scale conflict with Russia. In the view of European leaders, the solution to filling Kyiv's budget hole of €135.7bn for the following biennium rests with Moscow's immobilized funds held by Belgian bank Euroclear, and Brussels seek to give it the green light at their Brussels summit next week. Authorities in Russia state the EU plan would be an illegal seizure, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court ahead of a definitive agreement is made. 'Just' to Employ Russia's Assets, Argue European and Ukrainian Officials All told, Russia has roughly €210bn of its assets blocked in the EU, and €185bn of that is held by Euroclear. The EU and Ukraine contend that those funds should be used to restore what Russia has laid waste to: The European Commission terms it a "reparations loan" and has proposed a plan to prop up Ukraine's economy amounting to €90bn. "It is only just that Moscow's blocked funds should be used to reconstruct what Russia has destroyed – and that those funds then becomes Ukraine's," remarks Ukrainian President Volodymyr Zelensky. Chancellor Friedrich Merz states the assets will "enable Ukraine to protect itself effectively against any future Russian attacks". Russia's court action was foreseen in Brussels. But it is not only Moscow that is concerned. The Belgian government is worried it will be saddled with an massive bill if it all fails, and Euroclear chief executive Valérie Urbain argues using the assets could "undermine the world's financial order". Euroclear also has an estimated €16-17bn locked in Russia. Belgian Prime Minister Bart de Wever has presented the EU with a series of "pragmatic, fair, and legitimate conditions" before he will accept the reconstruction loan scheme, and he has not excluded legal action if it "presents significant risks" for his country. What is the EU's Proposal? Brussels is racing against time before next Thursday's summit to finalize a arrangement that Belgium can accept. Until now the EU has avoided touching the principal funds directly but since last year has paid the "excess income" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the profits is considered permissible as Russia is subject to sanctions and the returns are not Russian sovereign property. But international military aid for Ukraine has slipped dramatically in 2025, and Europe has had trouble trying to make up the deficit caused by the US decision to largely cease funding Ukraine under President Donald Trump. There are presently two EU options seeking to furnishing Ukraine with €90bn, to finance a majority of its budgetary necessities. Option one is to borrow the funds on the markets, guaranteed by the EU budget as a collateral. This is Belgium's first choice but it demands a unanimous vote by EU leaders and that would be difficult when two member states object to funding Ukraine's military. This makes the other option lending Ukraine cash from the Moscow's immobilized capital, which were initially held in financial instruments but have now mostly turned into cash. That funding is Euroclear property deposited at the European Central Bank. The European Commission recognizes Belgium has justified fears and claims it is confident it has addressed them. The scheme is for Belgium to be safeguarded with a guarantee covering all the €210bn of Russian assets in the EU. If Euroclear face a financial hit of its own assets in Russia, the loss would be compensated from assets belonging to Russia's own settlement agency which are in the EU. If Russia targeted Belgium itself, any judgment by a Russian court would not be accepted in the EU. In a key development, EU ambassadors are poised to endorse on Friday to immobilise Russia's central bank assets held in Europe indefinitely. Previously they have had to vote all together every six months to continue the freeze, which could have meant a repeated risk to Belgium. The EU ambassadors are set to use an special provision under Article 122 of the EU Treaties so the assets remain frozen as long as an "direct danger to the economic security of the union" continues. Why Belgium is Still Not Convinced Brussels is adamant it remains a strong supporter of Ukraine, but sees juridical dangers in the plan and worries about being forced to deal with the repercussions if things do not work out. A typically fractured political scene in this case has come together in support of Prime Minister Bart de Wever, who is under pressure from European colleagues. "Belgium is a small economy. Belgian GDP is approximately €565bn – think about if it would need to carry a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to obtain sufficient guarantees for the loan itself, Belgium is concerned about an additional danger of being vulnerable to extra damages or penalties. Prof Colaert also contends the demand for Euroclear to provide a loan to the EU would breach EU banking regulations. "Lenders need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is instructing Euroclear to do just that. "What is the purpose of these banking laws? It's because we want banks to be stable. And if things fail it would be up to Belgium to save Euroclear. That's another reason why it's so crucial for Belgium to obtain absolute guarantees for Euroclear." The European Union Under Pressure from All Sides The situation is urgent, caution a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They maintain the proposal to use Russian funds is "the most financially feasible and politically achievable solution". "This is a crucial test for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do afterwards. That's why we have to succeed in a week's time". Although Russia is unyielding its money should not be used, there are additional apprehensions among leaders in Europe that the US may want to deploy Russia's frozen billions in another way, as part of its own diplomatic proposal. Zelensky has indicated Ukraine is coordinating with Europe and the US on a rebuilding fund, but he is also cognizant the US has been talking to Russia about future co-operation. An early draft of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving