EU pressure on Belgium to use frozen Russian assets for Ukraine grows - FT
Kyiv • UNN
Belgium is facing increasing pressure to allow the use of frozen Russian assets for a “reparation loan” to Ukraine. This comes after a shift in position by Berlin and other Western capitals, which now support the idea.
Belgium is facing increasing pressure to allow the use of frozen Russian assets for a "reparations loan" to Ukraine after Berlin and other Western capitals changed their position, the Financial Times reports, writes UNN.
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Around €190 billion of Russian state assets held at Euroclear, the central securities depository in Brussels, were frozen in response to Russia's full-scale invasion of Ukraine in 2022. However, many Western countries, including the US, Germany, and Belgium, have been reluctant to access these funds, fearing legal and financial consequences.
Europe's position has shifted in recent weeks, especially after the Trump administration urged G7 allies to seize "or otherwise utilize" Russia's underlying assets "to finance Ukraine's defense," according to a US policy paper seen by the Financial Times.
German Chancellor Friedrich Merz wrote in a recent FT article that €140 billion of these funds should be used as a loan for arming Ukraine.
The European Commission has since outlined a possible structure for such a "reparations loan," arguing that Moscow should bear the costs associated with the illegal war unleashed by Kremlin leader Vladimir Putin.
However, Belgian Prime Minister Bart De Wever has appealed to the other 26 EU countries to cover the legal and financial risks associated with this loan and to guarantee the full amount so that Belgium does not have to repay it.
His stance has drawn condemnation from other capitals, especially given that Euroclear's profits are subject to Belgian corporate tax, the publication writes.
"[Belgium] has argued for three years that Euroclear is a Belgian company, and therefore the benefits from it are too," said one senior EU diplomat involved in the negotiations on the matter. "Now that it wants to share the risks, it claims that Euroclear is a European company."
Three diplomats involved in preparing the next round of EU talks on Wednesday said that patience with Belgian officials was running out.
Other capitals argue that Ukraine's plight requires solidarity, noting that Poland has agreed to host a major arms supply hub for Ukraine, and Denmark to send F-16 fighter jets to Kyiv, without demanding other risk-sharing.
"There are no more easy ways," another EU diplomat said. "Everyone must do what they can."
The European Commission has reportedly already tried to allay some of Belgium's concerns by adding a provision to cover the loan with national contingent liabilities if Russia begins to pay war reparations.
"We believe that the risks for Belgium here are quite limited," a senior EU official said. "That doesn't mean there are no risks at all, and it doesn't mean we don't want to have a serious dialogue with Belgium... But these risks are probably manageable."
The European Commission, supported by most EU capitals, argues that the loan is structured in a way that will not lead to asset seizure, and points out that court decisions outside the bloc are not recognized by the EU.
However, the Belgian government stated that "the current plan in circulation is unsatisfactory" and that contingent liabilities "do not address the issue of risk coverage."
The EU intends to agree on a €140 billion loan by December, with the first payments scheduled for the second quarter of 2026
According to Euroclear, since 2022, the Belgian government has collected €3.6 billion in taxes from profits generated by assets belonging to the Russian central bank and Russian companies under EU sanctions.
The Belgian government stated that these tax revenues were "fully earmarked for supporting Ukraine."
However, as the publication notes, not all the money has been transferred to Kyiv. "Some behind my back say I'm profiting from the war... because I want to keep a billion in tax money," De Wever said last week. "In my language, that's called 'small money,' one billion, for the risk we're taking."
De Wever's position, the publication indicates, caused irritation among some EU leaders at a recent summit in Copenhagen, officials familiar with the discussions told the FT. They also pointed to Belgium's relatively low level of military support for Ukraine over the past three years compared to Denmark, Sweden, and Germany, which have provided significantly more to Ukraine.
Belgian officials argue that De Wever's position is justified as he is defending his national interests.
"It makes sense to look them in the eye and say where the red lines are," one of them said.
But other EU leaders said his lack of flexibility was starting to backfire.
"What's the alternative?" Danish Prime Minister Mette Frederiksen told the FT when asked about disagreement with the frozen assets plan. "We have to find a way to finance it, and if not, then I haven't heard any [other] ideas."