The European Union is preparing a loan of €140 billion from frozen Russian assets. According to the Commission's plan, the liquid funds from frozen Russian Central Bank securities will be used to cover Ukraine's financial needs in 2026 and 2027.
However, the plan is facing legal and financial reservations from some member states – particularly Belgium, where most of the assets are located.
The key question remains how the funds may be used. Some countries insist that they should primarily be used to purchase European weapons, while others advocate a more flexible use – including for American supplies.
Ukraine is pushing for maximum autonomy. “Ukraine's position is that any conditionality undermines the principle of fairness. Therefore, the victim – not the donors or partners – should determine how to meet its most urgent needs in the areas of defense, reconstruction, and compensation,” explained Iryna Mudrova, legal advisor in President Zelensky's administration.
She added that if European countries did not have sufficient defense capabilities, it must be possible to procure them outside Europe. Part of the loan must also be used for “urgent reconstruction projects” such as Ukraine's critical energy infrastructure and “an appropriate amount” for victim compensation.
The European Commission therefore proposed a compromise whereby Kiev could spend most of the loan on Ukrainian and European weapons, but a smaller portion on general budget support – and thus also on the purchase of weapons outside Europe.
Russia described the proposal as an illegal expropriation of property and threatened retaliatory measures.
On Wednesday, EU member states also adopted the 19th package of sanctions against Russia. It includes a ban on Russian liquefied natural gas (LNG) from January 2027, as well as new measures against the so-called shadow fleet of Russian tankers and two independent Chinese oil refineries.
(reuters, max)