🔗 Share this article Moscow Retaliates at Europe's Proposal to Loan Frozen Moscow's Assets to Kyiv Kyiv remains running out of funding to maintain its military and economy, after almost four years of Russia's full-scale war. For Europe, the answer to plugging Kyiv's financial shortfall of €135.7bn for the next two years is found in frozen Russian assets held by Belgian bank Euroclear, and Brussels hope to sign that off at their Brussels summit next week. Russian officials state the EU plan would be an confiscation, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court prior to a definitive agreement is made. 'Only Fair' to Use Moscow's Funds, Say European and Ukrainian Officials All told, Russia has roughly €210bn of its assets blocked in the EU, and €185bn of that is managed by Euroclear. Brussels and Kyiv argue that money should be used to reconstruct what Russia has laid waste to: Brussels refers to it as a "reparations loan" and has proposed a plan to prop up Ukraine's economy to the tune of €90bn. "It's only fair that Russia's frozen assets should be used to rebuild what Russia has destroyed – and that that capital then becomes ours," says Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "enable Ukraine to shield itself effectively against any future Russian attacks". The legal move by Moscow was anticipated in Brussels. But it is not only Moscow that is concerned. The Belgian government is concerned it will be saddled with an huge bill if it all goes wrong, and Euroclear head Valérie Urbain warns using the assets could "disrupt the global financial architecture". Euroclear also has an approximate €16-17bn locked in Russia. The leader of Belgium Bart de Wever has given Brussels a series of "logical, sensible, and warranted conditions" before he will agree to the reconstruction loan scheme, and he has refused to rule out legal action if it "carries significant risks" for his country. Explaining the EU's Proposal? The EU is under pressure prior to next Thursday's summit to agree on a arrangement that Belgium can support. So far the EU has held off accessing the principal funds directly but for the past year has transferred the "extraordinary revenues" from them to Ukraine. In 2024 that was €3.7bn. From a legal standpoint, using the profits is considered permissible as Russia is subject to sanctions and the earnings are not Russian sovereign property. But global military support for Ukraine has declined sharply in 2025, and Europe has found it difficult to make up the shortfall caused by the US decision to all but stop funding Ukraine under President Donald Trump. There are presently two EU plans designed to providing Ukraine with €90bn, to pay for a majority of its financial requirements. The first is to raise the money on capital markets, secured against the EU budget as a surety. This is Belgium's first choice but it requires a agreement by all by EU leaders and that would be problematic when Budapest and Bratislava are against funding Ukraine's military. This makes the other option providing a loan of Ukraine cash from the frozen Russian funds, which were originally held in securities but have now largely matured into cash. That money is Euroclear property located within the European Central Bank. The European Commission accepts Belgium has valid worries and states it is assured it has dealt with them. The proposal is for Belgium to be safeguarded with a insurance encompassing all the €210bn of Russian assets in the EU. If Euroclear incur losses of its own assets in Russia, the loss would be compensated from assets belonging to Russia's own clearing house which are in the EU. In the event that Russia targeted Belgium itself, any ruling by a Russian court would not be enforced in the EU. As an important step, EU ambassadors are set to approve on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Previously they have had to vote unanimously every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are set to use an extraordinary measure under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Remains Satisfied The Belgian government is firm it remains a committed partner of Ukraine, but sees legal risks in the plan and fears being left to handle the fallout if things do not work out. A typically partisan political environment in this case has come together in support of Prime Minister Bart de Wever, who is facing pressure from European colleagues. "Belgium is a small economy. Belgian GDP is around €565bn – imagine if it would need to bear a €185bn bill," comments Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to secure enough protections for the loan itself, Belgium worries about an further exposure of being subject to extra damages or penalties. Prof Colaert also believes the demand for Euroclear to grant a loan to the EU would contravene EU banking regulations. "Banks need to follow capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these financial regulations? It's because we want banks to be solvent. And if things turn sour it would fall to Belgium to rescue Euroclear. That's an additional reason why it's so crucial for Belgium to secure absolute assurances for Euroclear." The European Union Under Pressure from Every Direction Time is of the essence, caution a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They argue the scheme involving immobilized capital is "a financially feasible and politically realistic solution". "It is a decisive moment for us," warns leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do subsequently. That's why we have to reach an agreement in a week's time". While Russia is adamant its money should not be used, there are further worries among leaders in Europe that the US may want to employ Russia's immobilized billions differently, as part of its own peace plan. Zelensky has said Ukraine is in discussions with Europe and the US on a reconstruction fund, but he is also mindful the US has been engaging with Russia about future co-operation. An initial document of the US peace plan suggested $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving
Kyiv remains running out of funding to maintain its military and economy, after almost four years of Russia's full-scale war. For Europe, the answer to plugging Kyiv's financial shortfall of €135.7bn for the next two years is found in frozen Russian assets held by Belgian bank Euroclear, and Brussels hope to sign that off at their Brussels summit next week. Russian officials state the EU plan would be an confiscation, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court prior to a definitive agreement is made. 'Only Fair' to Use Moscow's Funds, Say European and Ukrainian Officials All told, Russia has roughly €210bn of its assets blocked in the EU, and €185bn of that is managed by Euroclear. Brussels and Kyiv argue that money should be used to reconstruct what Russia has laid waste to: Brussels refers to it as a "reparations loan" and has proposed a plan to prop up Ukraine's economy to the tune of €90bn. "It's only fair that Russia's frozen assets should be used to rebuild what Russia has destroyed – and that that capital then becomes ours," says Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "enable Ukraine to shield itself effectively against any future Russian attacks". The legal move by Moscow was anticipated in Brussels. But it is not only Moscow that is concerned. The Belgian government is concerned it will be saddled with an huge bill if it all goes wrong, and Euroclear head Valérie Urbain warns using the assets could "disrupt the global financial architecture". Euroclear also has an approximate €16-17bn locked in Russia. The leader of Belgium Bart de Wever has given Brussels a series of "logical, sensible, and warranted conditions" before he will agree to the reconstruction loan scheme, and he has refused to rule out legal action if it "carries significant risks" for his country. Explaining the EU's Proposal? The EU is under pressure prior to next Thursday's summit to agree on a arrangement that Belgium can support. So far the EU has held off accessing the principal funds directly but for the past year has transferred the "extraordinary revenues" from them to Ukraine. In 2024 that was €3.7bn. From a legal standpoint, using the profits is considered permissible as Russia is subject to sanctions and the earnings are not Russian sovereign property. But global military support for Ukraine has declined sharply in 2025, and Europe has found it difficult to make up the shortfall caused by the US decision to all but stop funding Ukraine under President Donald Trump. There are presently two EU plans designed to providing Ukraine with €90bn, to pay for a majority of its financial requirements. The first is to raise the money on capital markets, secured against the EU budget as a surety. This is Belgium's first choice but it requires a agreement by all by EU leaders and that would be problematic when Budapest and Bratislava are against funding Ukraine's military. This makes the other option providing a loan of Ukraine cash from the frozen Russian funds, which were originally held in securities but have now largely matured into cash. That money is Euroclear property located within the European Central Bank. The European Commission accepts Belgium has valid worries and states it is assured it has dealt with them. The proposal is for Belgium to be safeguarded with a insurance encompassing all the €210bn of Russian assets in the EU. If Euroclear incur losses of its own assets in Russia, the loss would be compensated from assets belonging to Russia's own clearing house which are in the EU. In the event that Russia targeted Belgium itself, any ruling by a Russian court would not be enforced in the EU. As an important step, EU ambassadors are set to approve on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Previously they have had to vote unanimously every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are set to use an extraordinary measure under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Remains Satisfied The Belgian government is firm it remains a committed partner of Ukraine, but sees legal risks in the plan and fears being left to handle the fallout if things do not work out. A typically partisan political environment in this case has come together in support of Prime Minister Bart de Wever, who is facing pressure from European colleagues. "Belgium is a small economy. Belgian GDP is around €565bn – imagine if it would need to bear a €185bn bill," comments Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to secure enough protections for the loan itself, Belgium worries about an further exposure of being subject to extra damages or penalties. Prof Colaert also believes the demand for Euroclear to grant a loan to the EU would contravene EU banking regulations. "Banks need to follow capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these financial regulations? It's because we want banks to be solvent. And if things turn sour it would fall to Belgium to rescue Euroclear. That's an additional reason why it's so crucial for Belgium to secure absolute assurances for Euroclear." The European Union Under Pressure from Every Direction Time is of the essence, caution a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They argue the scheme involving immobilized capital is "a financially feasible and politically realistic solution". "It is a decisive moment for us," warns leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do subsequently. That's why we have to reach an agreement in a week's time". While Russia is adamant its money should not be used, there are further worries among leaders in Europe that the US may want to employ Russia's immobilized billions differently, as part of its own peace plan. Zelensky has said Ukraine is in discussions with Europe and the US on a reconstruction fund, but he is also mindful the US has been engaging with Russia about future co-operation. An initial document of the US peace plan suggested $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving