European Union leaders have chosen to secure a 90 billion euro ($145 billion Cdn) loan for Ukraine over the next two years by borrowing funds, rather than utilizing frozen Russian assets. This decision was made after facing disagreements over a proposal to use Russian sovereign funds to support Kyiv.
The European Commission has been tasked with continuing to explore the option of a reparations loan based on Russian immobilized assets, but this approach was deemed unfeasible at present, mainly due to opposition from Belgium, where a significant portion of the assets is located. “Today, we have agreed to provide 90 billion euros to Ukraine,” announced EU summit chair António Costa following lengthy discussions among leaders in Brussels. “Urgently, we will offer a loan supported by the European Union budget.”
Italian Prime Minister Giorgia Meloni expressed satisfaction with the outcome, stating, “I am pleased that reason has prevailed, and we have secured the necessary resources through a solution that is legally and financially sound.” Ukraine expressed gratitude to the European Union for the crucial financial support, recognizing the potential consequences of not receiving aid, which could lead to a loss in the conflict against Russia.
The idea of EU borrowing initially faced challenges, as it required unanimous agreement, with Hungarian Prime Minister Viktor Orbán initially opposing the plan. However, Hungary, Slovakia, and the Czech Republic eventually agreed to proceed with the scheme as long as it did not impose financial burdens on them. Orbán emphasized, “We prevented Europe from initiating conflict with Russia using Russian assets.”
Slovakia Prime Minister Robert Fico stated that Slovakia opposes further financing of Ukraine’s military requirements, rejecting participation in any military loan for Ukraine. The EU leaders confirmed that Russian assets amounting to 210 billion euros ($339 billion Cdn) will remain frozen until Moscow fulfills war reparations to Ukraine. German Chancellor Friedrich Merz highlighted the positive impact on Ukraine and the negative implications for Russia resulting from this decision.
Belgium’s concerns regarding financial and legal risks associated with releasing the Russian assets to Ukraine led to a shift in strategy. Belgian Prime Minister Bart De Wever emphasized the importance of maintaining unity within the EU. With public finances already strained, the European Commission had proposed utilizing Russian assets for a loan to Kyiv or joint borrowing against the EU budget, ultimately opting for the latter option.
Russian President Vladimir Putin criticized the EU’s retreat from the original plan, accusing it of undermining trust in the euro zone and jeopardizing its status as a secure asset storage location. EU leaders underscored the importance of finding a viable solution to support Ukraine for the next two years, aiming to demonstrate resilience and strength in the face of external criticism.
President Zelenskyy had urged the EU to utilize Russian assets to provide the necessary funding, considering it a morally justifiable decision. The summit was crucial in ensuring continued financial backing for Ukraine and showcasing solidarity among European countries, particularly in response to recent criticism from U.S. President Donald Trump. EU foreign policy chief Kaja Kallas emphasized the necessity of success in this endeavor.
