BRUSSELS: European Union leaders are gathering Thursday for a summit aimed at agreeing on a massive loan to cover Ukraine’s military and other financial needs for the next two years.
The leaders will also discuss migration, the bloc’s enlargement policy, trade and economies, but working out how to fund most of the 137 billion euros ($160 billion) the International Monetary Fund says war-ravaged Ukraine needs is top priority.
“It is up to us to choose how we fund Ukraine’s fight. We know the urgency. It is acute. We all feel it. We all see it,” European Commission President Ursula von der Leyen told EU lawmakers on the eve of the summit.
European Council President António Costa, who is chairing Thursday’s meeting in Brussels, has vowed to keep leaders negotiating until an agreement is reached, even if it takes days.
Many leaders will press for tens of billions of euros in frozen Russian assets held in Europe to be used to meet Ukraine’s economic and military needs.
Such a decision has never been made before, and it comes with risks. The European Central Bank has warned that if Europeans appear willing to grab other countries’ money, it could undermine confidence in the euro. Some member nations are also concerned about inviting retaliation from Russia.
Belgium, where most of the frozen assets are held at a financial clearing house, is the main opponent of the plan. It fears that Russia will strike back and would prefer that the bloc borrow the money on international markets.
Last week, the Russian Central Bank sued the Belgian clearing house Euroclear in a Moscow court, raising pressure on Belgium and its European partners ahead of the summit.
Hungary and Slovakia oppose von der Leyen’s plan for a “reparations loan.” Some 90 billion euros ($105 billion) would be lent to Ukraine until Russia ends its war and pays for the damage it has caused over almost four years. Ukrainian President Volodymyr Zelensky says that totals more than 600 billion euros ($700 billion).
The UK, Canada and Norway would fill the gap beyond the 90 billion euros ($105 billion).
Bulgaria, Italy and Malta also remain to be convinced. In recent weeks, EU envoys have worked to flesh out the details and narrow differences among the 27 member countries. If enough countries object, the plan could be blocked. There is no majority support for a plan B of raising the funds on international markets.
EU leaders gather to discuss a massive loan to Ukraine
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EU leaders gather to discuss a massive loan to Ukraine
- European Council President António Costa has vowed to keep leaders negotiating until an agreement is reached, even if it takes days
Zelensky presses EU to tap Russian assets at crunch summit
- “Russian assets must be used to defend against Russian aggression and rebuild what was destroyed by Russian attacks. It’s moral. It’s fair. It’s legal,” Zelensky said
- German Chancellor Friedrich Merz was among those agreeing strongly as he said there was “no better option“
Brussels: Ukrainian President Volodymyr Zelensky told EU leaders Thursday they had the “moral” and legal right to use frozen Russian assets to fund Kyiv — as pressure grew on key player Belgium to drop its opposition at a summit showdown.
The 27-nation bloc is scrambling to bolster its ally Ukraine, as US President Donald Trump pushes for a deal with President Vladimir Putin to end the fighting.
Officials have insisted leaders’ talks in Brussels will last as long as it takes to hammer out an agreement, saying both Ukraine’s survival — nearly four years into the war — and Europe’s credibility are at stake.
“We will not leave the European summit without a solution for the funding of Ukraine,” European Commission head Ursula von der Leyen said.
The EU’s executive wants to fund a loan to Ukraine by using frozen assets from Russia’s central bank, though it is holding on to a back-up plan for the bloc to raise the money itself.
The EU estimates Ukraine needs an extra 135 billion euros ($159 billion) to stay afloat over the next two years — with the cash crunch set to start in April.
Zelensky said Kyiv needed a decision on its financing by the end of the year and that the move could give it more leverage in talks to end the war.
“Russian assets must be used to defend against Russian aggression and rebuild what was destroyed by Russian attacks. It’s moral. It’s fair. It’s legal,” Zelensky said.
German Chancellor Friedrich Merz was among those agreeing strongly as he said there was “no better option.”
But Belgium’s Prime Minister Bart De Wever — who held talks with Zelensky on the sidelines — seemed unconvinced so far.
“I have not seen a text that could persuade me to give Belgium’s agreement,” he told Belgian lawmakers before the summit kicked off.
The vast bulk of the assets are held by international deposit organization Euroclear in Belgium, and the government fears it could face crippling financial and legal reprisals from Moscow.
EU officials say they have gone out of their way to allay Belgian worries and that multiple layers of protection — including guarantees from other member states — mean the risks are minimal.
“At this stage, the guarantees offered by the Commission remain insufficient,” De Wever said.
- Ukraine’s looming cash crunch -
In a bid to plug Kyiv’s yawning gap, the Commission has proposed tapping 210 billion euros of frozen assets, initially to provide Kyiv 90 billion euros over two years.
The unprecedented scheme would see the funds loaned to the EU, which would then loan them on to Ukraine.
Kyiv would then only pay back the “reparations loan” once the Kremlin compensates it for the damage.
In theory, other EU countries could override Belgium and ram the initiative through with a weighted majority, but that would be a nuclear option that few see as likely for now.
De Wever insisted that the EU should go for its alternative plan of raising money itself — but diplomats said that option had been shelved as it needed unanimity and Hungary was firmly against.
Bubbling close to the surface of the EU’s discussion are the US efforts to forge a deal to end the war.
Zelensky said Ukrainian and US delegations would hold new talks on Friday and Saturday in the United States.
He said he wanted Washington to give more details on the guarantees it could offer to protect Ukraine from another invasion.
“What will the United States of America do if Russia comes again with aggression?” he asked. “What will these security guarantees do? How will they work?“
