Belgium shoots down EU offer to fund Ukraine's revival via Russian assets

Negotiations between EU ambassadors in the European Council dragged on late into the night of December 15 as Belgium demanded additional security guarantees for the use of frozen Russian assets to finance Ukraine.

The Belgian side wants to be sure that it will not be exposed to legal and financial risks if this plan is implemented, Caliber.Az reports via POLITICO.

The ambassadors attempted to persuade Belgium to support the unblocking of €210 billion loan to Ukraine through Russian assets.

With two days to go, the Commission is making a last push to convince EU member countries to back the loan so that billions of euros in Russian reserves held at the Euroclear bank in Brussels can be freed up to support Kyiv’s war-battered economy.

The EU’s 27 envoys will continue discussions on the scheme later on December 18, as talks to end Russia's almost four-year all-out war in Ukraine achieved some progress during a meeting of Western leaders and U.S. envoys in Berlin on December 15.

After days of negotiations on the assets, the Commission on December 15 suggested legal changes to its proposal to secure political buy-in from Belgium.

It gave legal assurances that, under any scenario, Belgium could tap into as much as €210 billion if it faces legal claims or retaliation by Russia, according to the latest text seen by POLITICO. It also stated that no money should be given to Ukraine before EU countries provide financial guarantees covering at least 50 per cent of the payout.

In a further concession, the Commission instructed all EU countries to end their bilateral investment treaties with Russia to ensure Belgium isn’t left alone to deal with retaliation from Moscow.

But Belgium said that the reassurances were not enough during a meeting of EU ambassadors on Monday evening, four EU diplomats told POLITICO.

The Belgian government is holding out against using the Russian assets over fears that it will be on the hook to repay the full amount if Russia attempts to claw back the money. But in a further complication, four other countries — Italy, Malta, Bulgaria and Czechia — backed Belgium’s demand to explore alternative financing for Ukraine, such as joint debt.

Last week, Politico reported that the European Commission was pushing for EU member countries to reach an agreement in a European Council summit on December 18-19 so that the billions of euros in Russian reserves held in the Euroclear bank in Belgium can be freed up to support Kyiv’s war-battered economy. 

By Khagan Isayev