🔗 Share this article Moscow Hits Back at Europe's Proposal to Loan Immobilized Moscow's Cash to Kyiv Ukraine is facing a severe shortage of cash to maintain its military and economy afloat, after nearly four years of full-scale conflict with Russia. From the EU's perspective, the remedy to plugging Ukraine's budget hole of €135.7bn for the following biennium is found in frozen Russian assets located within Belgian bank Euroclear, and Brussels hope to sign that off at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an confiscation, and Moscow's monetary authority declared on Friday it was taking to court Euroclear in a Moscow court ahead of a conclusive plan is made. 'Only Fair' to Utilize Moscow's Assets, Argue European and Ukrainian Officials Overall, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is managed by Euroclear. The EU and Ukraine contend that those funds should be used to reconstruct what Russia has destroyed: Brussels terms it a "reparations loan" and has devised a plan to support 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 devastated – and that those funds then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. Chancellor Friedrich Merz argues the assets will "enable Ukraine to protect itself effectively against any future Russian attacks". Russia's court action was expected in Brussels. But it is not just Moscow that is dissatisfied. Belgium is worried it will be burdened by an enormous bill if it all fails, and Euroclear CEO Valérie Urbain argues using the assets could "disrupt the global financial architecture". Euroclear also has an estimated €16-17bn frozen in Russia. The leader of Belgium Bart de Wever has given Brussels a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reparations plan, and he has refused to rule out legal action if it "poses significant risks" for his country. Explaining the EU's Strategy? European Union officials is working to the wire ahead of next Thursday's summit to finalize a compromise that Belgium can support. Previously the EU has avoided using the assets themselves directly but since last year has paid the "windfall profits" from them to Ukraine. In 2024 that totaled €3.7bn. Legally, using the profits is deemed permissible as Russia is sanctioned and the earnings are not property of the Russian state. But international military aid for Ukraine has slipped dramatically in 2025, and Europe has struggled to cover the shortfall resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are currently two EU options aimed at supplying Ukraine with €90bn, to cover two-thirds of its funding needs. The first is to borrow the funds on financial markets, guaranteed by the EU budget as a guarantee. This is Belgium's preferred option but it requires a unanimous vote by EU leaders and that would be challenging when two member states object to funding Ukraine's military. The alternative is loaning Ukraine cash from the frozen Russian funds, which were at first held in securities but have now predominantly been converted into cash. That capital is an asset of Euroclear held in the European Central Bank. The European Commission accepts Belgium has valid worries and says it is assured it has addressed them. The proposal is for Belgium to be shielded with a insurance applying to all the €210bn of Russian assets in the EU. Should 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. If Russia took legal action against Belgium itself, any judgment by a Russian court would not be accepted in the EU. In a significant move, EU ambassadors are set to approve on Friday to permanently block Russia's central bank assets held in Europe for the foreseeable future. Until now they have had to vote by consensus every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an emergency clause under Article 122 of the EU Treaties so the assets remain frozen as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Still Not Convinced Brussels is adamant it remains a staunch ally of Ukraine, but sees legal risks in the plan and fears being shouldering the fallout if things go wrong. A usually fractured political scene in this case has united behind Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "The Belgian economy is not large. Belgian GDP is approximately €565bn – imagine if it would need to bear a €185bn bill," comments Veerle Colaert, professor of financial law at KU Leuven University. While the EU might be able to secure enough assurances for the loan itself, Belgium is concerned about an further exposure of being subject to extra damages or penalties. Prof Colaert also believes the demand for Euroclear to issue credit to the EU would breach EU banking regulations. "Financial institutions need to adhere to prudential rules and shouldn't put all their eggs in one basket. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these bank rules? It's because we want banks to be stable. And if things turn sour it would become the responsibility of Belgium to rescue Euroclear. That's an additional reason why it's so important for Belgium to secure water-tight protections for Euroclear." The European Union In a Difficult Position from Multiple Fronts There is no time to lose, state seven EU member states including those closest to Russia such as the Baltics, Finland and Poland. They believe the frozen assets plan is "the fiscally viable and politically achievable solution". "It is a decisive moment for us," warns leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do next. That's why we have to finalize the deal in a week's time". While Russia is adamant its money should not be touched, there are further worries among European figures that the US may want to employ Russia's immobilized billions for another purpose, as part of its own peace initiative. Zelensky has said Ukraine is in discussions with Europe and the US on a recovery fund, but he is also mindful the US has been talking to Russia about potential collaboration. An initial document of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving
Ukraine is facing a severe shortage of cash to maintain its military and economy afloat, after nearly four years of full-scale conflict with Russia. From the EU's perspective, the remedy to plugging Ukraine's budget hole of €135.7bn for the following biennium is found in frozen Russian assets located within Belgian bank Euroclear, and Brussels hope to sign that off at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an confiscation, and Moscow's monetary authority declared on Friday it was taking to court Euroclear in a Moscow court ahead of a conclusive plan is made. 'Only Fair' to Utilize Moscow's Assets, Argue European and Ukrainian Officials Overall, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is managed by Euroclear. The EU and Ukraine contend that those funds should be used to reconstruct what Russia has destroyed: Brussels terms it a "reparations loan" and has devised a plan to support 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 devastated – and that those funds then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. Chancellor Friedrich Merz argues the assets will "enable Ukraine to protect itself effectively against any future Russian attacks". Russia's court action was expected in Brussels. But it is not just Moscow that is dissatisfied. Belgium is worried it will be burdened by an enormous bill if it all fails, and Euroclear CEO Valérie Urbain argues using the assets could "disrupt the global financial architecture". Euroclear also has an estimated €16-17bn frozen in Russia. The leader of Belgium Bart de Wever has given Brussels a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reparations plan, and he has refused to rule out legal action if it "poses significant risks" for his country. Explaining the EU's Strategy? European Union officials is working to the wire ahead of next Thursday's summit to finalize a compromise that Belgium can support. Previously the EU has avoided using the assets themselves directly but since last year has paid the "windfall profits" from them to Ukraine. In 2024 that totaled €3.7bn. Legally, using the profits is deemed permissible as Russia is sanctioned and the earnings are not property of the Russian state. But international military aid for Ukraine has slipped dramatically in 2025, and Europe has struggled to cover the shortfall resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are currently two EU options aimed at supplying Ukraine with €90bn, to cover two-thirds of its funding needs. The first is to borrow the funds on financial markets, guaranteed by the EU budget as a guarantee. This is Belgium's preferred option but it requires a unanimous vote by EU leaders and that would be challenging when two member states object to funding Ukraine's military. The alternative is loaning Ukraine cash from the frozen Russian funds, which were at first held in securities but have now predominantly been converted into cash. That capital is an asset of Euroclear held in the European Central Bank. The European Commission accepts Belgium has valid worries and says it is assured it has addressed them. The proposal is for Belgium to be shielded with a insurance applying to all the €210bn of Russian assets in the EU. Should 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. If Russia took legal action against Belgium itself, any judgment by a Russian court would not be accepted in the EU. In a significant move, EU ambassadors are set to approve on Friday to permanently block Russia's central bank assets held in Europe for the foreseeable future. Until now they have had to vote by consensus every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an emergency clause under Article 122 of the EU Treaties so the assets remain frozen as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Still Not Convinced Brussels is adamant it remains a staunch ally of Ukraine, but sees legal risks in the plan and fears being shouldering the fallout if things go wrong. A usually fractured political scene in this case has united behind Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "The Belgian economy is not large. Belgian GDP is approximately €565bn – imagine if it would need to bear a €185bn bill," comments Veerle Colaert, professor of financial law at KU Leuven University. While the EU might be able to secure enough assurances for the loan itself, Belgium is concerned about an further exposure of being subject to extra damages or penalties. Prof Colaert also believes the demand for Euroclear to issue credit to the EU would breach EU banking regulations. "Financial institutions need to adhere to prudential rules and shouldn't put all their eggs in one basket. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these bank rules? It's because we want banks to be stable. And if things turn sour it would become the responsibility of Belgium to rescue Euroclear. That's an additional reason why it's so important for Belgium to secure water-tight protections for Euroclear." The European Union In a Difficult Position from Multiple Fronts There is no time to lose, state seven EU member states including those closest to Russia such as the Baltics, Finland and Poland. They believe the frozen assets plan is "the fiscally viable and politically achievable solution". "It is a decisive moment for us," warns leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do next. That's why we have to finalize the deal in a week's time". While Russia is adamant its money should not be touched, there are further worries among European figures that the US may want to employ Russia's immobilized billions for another purpose, as part of its own peace initiative. Zelensky has said Ukraine is in discussions with Europe and the US on a recovery fund, but he is also mindful the US has been talking to Russia about potential collaboration. An initial document of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving