Ukraine is facing complications on its path to receiving a reparations credit from the European Union. This is due to the growing opposition to plans to use frozen Russian assets held in the Belgian depository Euroclear to finance the country’s defense and needs.
This is reported by Finway
European States’ Position on Frozen Russian Assets
European leaders have been negotiating for several months regarding the possibility of using approximately 185 billion euros belonging to the Russian Federation that have been frozen in Euroclear. An additional 25 billion euros are in the form of other frozen Russian assets within EU countries. However, an increasing number of European states are opposing this plan.
Belgium’s demand to seek alternative funding mechanisms for Ukraine has been joined by five other countries. Notably, Italy, the third-largest economy in the EU, has supported this position. Malta and Bulgaria also signed the corresponding letter. The new Prime Minister of the Czech Republic, Andrej Babiš, also announced on Sunday that he would not participate in this plan.
“A sign that the chances of an agreement are deteriorating is that Italy – the third-largest economy in the EU – has supported Belgium’s demands to seek alternative funding mechanisms for Ukraine. Malta and Bulgaria also signed the corresponding letter on Friday,” the material states.
Although these five countries cannot form a blocking minority even with support from Hungary and Slovakia, their public opposition creates additional obstacles to reaching a consensus in the European Commission. The meeting of EU ambassadors, which was supposed to take place on Sunday evening, has been postponed to Monday.
Diplomatic Pressure and Legal Claims from Russia
Despite tense negotiations, three European diplomats assured that the plan to use frozen assets remains valid, alternative options are currently not being considered, and Belgium is actively working on amendments to the draft resolutions to be presented at the EU ambassadors’ meeting.
At the same time, the situation is complicated by legal pressure from the Russian Federation. The Bank of Russia has filed a lawsuit in the Moscow Arbitration Court demanding 18.2 trillion rubles (229 billion dollars) from Euroclear. The Russian central bank has stated its intention to seek closed hearings and claims that the lawsuit amount covers not only the frozen assets but also additional income lost from them. Furthermore, Russia plans to challenge any unauthorized use of its assets in various jurisdictions, including national and international courts.
Public criticism from several countries regarding the plan to use Russian assets undermines the EU’s chances of reaching an agreement in the near future, while Ukraine urgently needs these funds for defense and stability.