🔗 Share this article Moscow Hits Back at the EU's Scheme to Lend Immobilized Moscow's Assets to Ukraine Ukraine is facing a severe shortage of financial resources to keep going its armed forces and economy afloat, after nearly four years of Russia's full-scale war. In the view of European leaders, the remedy to filling Ukraine's budget hole of €135.7bn for the coming 24 months rests with frozen Russian assets sitting in Belgian bank Euroclear, and EU leaders seek to finalize the plan at their EU leaders' conference next week. Russian officials warn the EU plan would be an act of theft, and the Central Bank of Russia announced on Friday it was suing Euroclear in a Moscow court ahead of a final decision is made. 'Only Fair' to Utilize Russia's Assets, Say European and Ukrainian Officials All told, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is held by Euroclear. Brussels and Kyiv contend that that capital should be used to reconstruct what Russia has devastated: The European Commission terms it a "loan for reparations" and has come up with a plan to support Ukraine's economy valued at €90bn. "It is only just that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes Ukraine's," remarks Ukraine's Volodymyr Zelensky. Chancellor Friedrich Merz argues the assets will "help Ukraine to shield itself successfully against future Russian attacks". The legal move by Moscow was foreseen in Brussels. But it is not just Moscow that is unhappy. Belgium is concerned it will be saddled with an huge bill if it all goes wrong, and Euroclear chief executive Valérie Urbain warns using the assets could "undermine the world's financial order". Euroclear also has an roughly €16-17bn immobilised in Russia. Belgian Prime Minister Bart de Wever has set the EU a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reconstruction loan scheme, and he has not excluded legal action if it "presents significant risks" for his country. What is the EU's Strategy? Brussels is under pressure before next Thursday's summit to agree on a compromise that Belgium can support. So far the EU has held off using the principal funds directly but for the past year has transferred the "windfall profits" from them to Ukraine. In 2024 that amounted to €3.7bn. Juridically, using the interest is deemed less risky as Russia is subject to sanctions and the earnings are not Russian sovereign property. But foreign defense assistance for Ukraine has slipped dramatically in 2025, and Europe has found it difficult to compensate for the deficit caused by the US decision to all but stop funding Ukraine under President Donald Trump. There are currently two EU plans seeking to supplying Ukraine with €90bn, to pay for a majority of its funding needs. Option one is to borrow the funds on financial markets, backed by the EU budget as a guarantee. This is Belgium's first choice but it demands a consensus by EU leaders and that would be challenging when Hungary and Slovakia object to funding Ukraine's military. This makes the other option loaning Ukraine cash from the Russian assets, which were at first held in securities but have now predominantly matured into cash. That money is owned by Euroclear located within the European Central Bank. Brussels' executive arm accepts Belgium has valid worries and states it is assured it has resolved them. The proposal is for Belgium to be safeguarded with a assurance encompassing all the €210bn of Russian assets in the EU. Should Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered 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 accepted in the EU. In a significant move, EU ambassadors are set to approve on Friday to immobilise Russia's central bank assets held in Europe for the foreseeable future. Heretofore they have had to vote all together every six months to renew the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an extraordinary measure under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "clear risk to the economic security of the union" continues. The Reasons Belgium is Still Not On Board Belgium is insistent it remains a committed partner of Ukraine, but identifies legal risks in the plan and is concerned about being forced to deal with the consequences if things go wrong. A usually partisan political environment in this case has united behind Prime Minister Bart de Wever, who is under pressure from other European officials. "Belgium is a small economy. Belgian GDP is around €565bn – imagine if it would need to shoulder a €185bn bill," says Veerle Colaert, expert in financial law at KU Leuven University. While the EU might be able to arrange sufficient assurances for the loan itself, Belgium worries about an added risk of being exposed to extra damages or penalties. Prof Colaert also believes the stipulation for Euroclear to provide a loan to the EU would violate EU banking regulations. "Financial institutions need to comply with stability regulations and shouldn't put all their eggs in one basket. Now the EU is telling Euroclear to do precisely that. "Why do we have these financial regulations? It's because we want banks to be secure. And if things turn sour it would fall to Belgium to save Euroclear. That's another reason why it's so crucial for Belgium to secure water-tight guarantees for Euroclear." EU Leaders In a Difficult Position from Multiple Fronts There is no time to lose, caution a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the economically realistic and politically realistic solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do next. That's why we have to succeed in a week's time". Although Russia is adamant its money should not be used, there are additional apprehensions among EU officials that the US may want to deploy Russia's frozen billions in another way, as part of its own peace plan. Zelensky has stated Ukraine is coordinating with Europe and the US on a reconstruction fund, but he is also cognizant the US has been holding discussions with Russia about future co-operation. An early draft of the US peace plan referred to $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving
Ukraine is facing a severe shortage of financial resources to keep going its armed forces and economy afloat, after nearly four years of Russia's full-scale war. In the view of European leaders, the remedy to filling Ukraine's budget hole of €135.7bn for the coming 24 months rests with frozen Russian assets sitting in Belgian bank Euroclear, and EU leaders seek to finalize the plan at their EU leaders' conference next week. Russian officials warn the EU plan would be an act of theft, and the Central Bank of Russia announced on Friday it was suing Euroclear in a Moscow court ahead of a final decision is made. 'Only Fair' to Utilize Russia's Assets, Say European and Ukrainian Officials All told, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is held by Euroclear. Brussels and Kyiv contend that that capital should be used to reconstruct what Russia has devastated: The European Commission terms it a "loan for reparations" and has come up with a plan to support Ukraine's economy valued at €90bn. "It is only just that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes Ukraine's," remarks Ukraine's Volodymyr Zelensky. Chancellor Friedrich Merz argues the assets will "help Ukraine to shield itself successfully against future Russian attacks". The legal move by Moscow was foreseen in Brussels. But it is not just Moscow that is unhappy. Belgium is concerned it will be saddled with an huge bill if it all goes wrong, and Euroclear chief executive Valérie Urbain warns using the assets could "undermine the world's financial order". Euroclear also has an roughly €16-17bn immobilised in Russia. Belgian Prime Minister Bart de Wever has set the EU a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reconstruction loan scheme, and he has not excluded legal action if it "presents significant risks" for his country. What is the EU's Strategy? Brussels is under pressure before next Thursday's summit to agree on a compromise that Belgium can support. So far the EU has held off using the principal funds directly but for the past year has transferred the "windfall profits" from them to Ukraine. In 2024 that amounted to €3.7bn. Juridically, using the interest is deemed less risky as Russia is subject to sanctions and the earnings are not Russian sovereign property. But foreign defense assistance for Ukraine has slipped dramatically in 2025, and Europe has found it difficult to compensate for the deficit caused by the US decision to all but stop funding Ukraine under President Donald Trump. There are currently two EU plans seeking to supplying Ukraine with €90bn, to pay for a majority of its funding needs. Option one is to borrow the funds on financial markets, backed by the EU budget as a guarantee. This is Belgium's first choice but it demands a consensus by EU leaders and that would be challenging when Hungary and Slovakia object to funding Ukraine's military. This makes the other option loaning Ukraine cash from the Russian assets, which were at first held in securities but have now predominantly matured into cash. That money is owned by Euroclear located within the European Central Bank. Brussels' executive arm accepts Belgium has valid worries and states it is assured it has resolved them. The proposal is for Belgium to be safeguarded with a assurance encompassing all the €210bn of Russian assets in the EU. Should Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered 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 accepted in the EU. In a significant move, EU ambassadors are set to approve on Friday to immobilise Russia's central bank assets held in Europe for the foreseeable future. Heretofore they have had to vote all together every six months to renew the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an extraordinary measure under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "clear risk to the economic security of the union" continues. The Reasons Belgium is Still Not On Board Belgium is insistent it remains a committed partner of Ukraine, but identifies legal risks in the plan and is concerned about being forced to deal with the consequences if things go wrong. A usually partisan political environment in this case has united behind Prime Minister Bart de Wever, who is under pressure from other European officials. "Belgium is a small economy. Belgian GDP is around €565bn – imagine if it would need to shoulder a €185bn bill," says Veerle Colaert, expert in financial law at KU Leuven University. While the EU might be able to arrange sufficient assurances for the loan itself, Belgium worries about an added risk of being exposed to extra damages or penalties. Prof Colaert also believes the stipulation for Euroclear to provide a loan to the EU would violate EU banking regulations. "Financial institutions need to comply with stability regulations and shouldn't put all their eggs in one basket. Now the EU is telling Euroclear to do precisely that. "Why do we have these financial regulations? It's because we want banks to be secure. And if things turn sour it would fall to Belgium to save Euroclear. That's another reason why it's so crucial for Belgium to secure water-tight guarantees for Euroclear." EU Leaders In a Difficult Position from Multiple Fronts There is no time to lose, caution a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the economically realistic and politically realistic solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do next. That's why we have to succeed in a week's time". Although Russia is adamant its money should not be used, there are additional apprehensions among EU officials that the US may want to deploy Russia's frozen billions in another way, as part of its own peace plan. Zelensky has stated Ukraine is coordinating with Europe and the US on a reconstruction fund, but he is also cognizant the US has been holding discussions with Russia about future co-operation. An early draft of the US peace plan referred to $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving