The EU lays out a plan to fund Ukraine using frozen Russian assets but Belgium says it’s too risky

Germany's Foreign Minister Johann Wadephul, right, speaks with NATO Secretary General Mark Rutte during a meeting of the North Atlantic Council in Foreign Ministers Session at NATO headquarters in Brussels, Wednesday, Dec. 3, 2025. (AP Photo/Geert Vanden Wijngaert)

BRUSSELS — The European Union on Wednesday revealed details of its plan to use billions of euros in frozen Russian assets to fund Ukraine’s needs over the next two years, but Belgium rejected the scheme and insisted that it poses major financial and legal risks.

European Commission President Ursula von der Leyen said that the EU would cover two-thirds of Ukraine’s financial and military needs for 2026 and 2027, which the International Monetary Fund puts at 137 billion euros (US$160 billion), by providing 90 billion euros (US$105 billion).

She said that other international partners would be called on to cover the remaining third.

“Today we are sending a very strong message to the Ukrainian people. We are with them for the long haul,” said von der Leyen while rolling out the proposal which would use Russian money as collateral to fund Ukraine’s economy and war effort through a “reparations loan.”

Von der Leyen said that using the frozen assets would strengthen the Ukrainian position at peace negotiations with Russia and the U.S. but it would also send a message to Moscow that “the prolongation of the war on their side comes with a high cost for them.” She said that she had informed the Trump administration about the proposal.

Funding Ukraine

EU leaders have committed to fund Ukraine over the next two years, whatever the method. The EU has already poured in over 170 billion euros (US$197 billion) since the war started in 2022.

Von der Leyen said that if the loan plan didn’t pass muster, the bloc could borrow the money on international markets in a scheme underpinned by its long-term budget. The problem here, though, is that it would require the approval of all 27 member countries, and Hungary has consistently blocked aid to Ukraine.

The biggest pot of ready funds available is through frozen Russian assets. Most of the money is held in Belgium – around 194 billion euros as of June – and outside the EU in Japan, with around US$50 billion, and the U.S., U.K. and Canada with lesser amounts. A total of 210 billion euros worth (US$245 billion) are held in Europe.

To address Belgian concerns, the commission’s complex proposal includes safeguards to protect EU nations from “possible retaliation from Russia,” a prohibition of any release of the frozen assets, and a way to borrow money as the EU to ”underpin a loan to Ukraine.”

Too risky for Belgium

But Belgian Foreign Minister Maxime Prévot said that his country considers “the option of the reparations loan the worst of all, as it is risky. It has never been done before.” Russia has described the scheme as “theft.”

Haltingly reading prepared remarks to reporters at NATO headquarters in Brussels, Prévot urged the EU to borrow the money for Ukraine on international markets. “It is a well-known, a robust and a well-established option with predictable parameters,” he said.

“The reparation loans scheme entails consequential economic, financial and legal risks,” he said, adding that the commission’s proposals do not address Belgium’s concerns. “It is not acceptable to use the money and leave us alone facing the risks.”

Belgium fears that the Brussels-based financial clearing house holding the frozen assets, Euroclear, could take legal action if Russia challenges any use of the funds or if the move harms its image and business interests.

Prévot said Belgium feels that its concerns are not being heard by its EU partners.

“We are not seeking to antagonize our partners or Ukraine. We are simply seeking to avoid potential disastrous consequences for a member state that is being asked to show solidarity without being offered the same solidarity in return,” he said.

EU partners say they’re listening

In essence, the 90 billion euros would not be seized from Russia as such, as Kyiv would refund it once Moscow pays significant reparations for the massive destruction its war has caused. Should Moscow refuse, the assets would remain frozen.

“We have listened very carefully to Belgium’s concerns, and we have taken almost all of them into account in our proposal,” Von der Leyen said. “We will share the burden in a fair way, as it is the European way.”

Other EU partners insist that they too understand Belgium’s worries.

“We take Belgium’s concerns seriously,” German Foreign Minister Johann Wadephul told reporters. “They are justified, but the issue can be resolved. It can be resolved if we are prepared to take responsibility together.”

His Dutch counterpart David van Weel underlined that “these funds are really, really important. We need to support the Ukrainian economy, otherwise they will have a very tough time next year.”

“We understand the Belgian concerns, and we are willing to at least make sure that they are not alone in this,” he said. Several EU countries have already agreed to provide financial guarantees should things go wrong.

Belgium has been earning some tax income on the assets, and the interest raised is also being used to fund a loan program for Ukraine organized by the Group of Seven major world powers.

The European Central Bank is worried that the plan for an EU reparation loan could undermine confidence in the euro single currency on international markets. EU leaders are due to discuss the scheme and Ukraine’s economic and military needs at a summit in Brussels on Dec. 18.

Lorne Cook And Sam Mcneil, The Associated Press