Politico: Europe failing Ukraine by blocking use of Russian assets

Europe is undermining Ukraine’s ability to sustain its war effort by refusing to use frozen Russian assets to finance Kyiv’s needs, Politico reports, warning that the conflict could end as early as next year on terms highly unfavourable for Ukraine.

According to the publication, the European Union’s failure to agree on a proposal to channel €210 billion in frozen Russian assets into a so-called “reparations loan” has deprived Ukraine of guaranteed funding for the next two years. The plan would have allowed Kyiv to remain solvent and continue financing its defence against Russia’s invasion.

The proposal collapsed amid legal concerns raised by Belgium, where most of the assets are held, as well as reluctance from French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni to support the initiative alongside German Chancellor Friedrich Merz. This occurred despite strong backing from European Commission President Ursula von der Leyen and weeks of negotiations.

While the EU has since agreed on a €90 billion joint-borrowing package to support Ukraine, Politico notes that the funds will be spread over two years and will be insufficient to keep the country fighting. International Monetary Fund projections indicate that Ukraine faces a budget shortfall of nearly $160 billion over the next two years, largely due to reduced U.S. financial support.

The outlet also highlights growing divisions within the EU, with Hungary, Slovakia and the Czech Republic opting out of the latest funding scheme. Other countries may follow suit, particularly as France and Germany approach key elections in 2027. Seeking additional assistance from the United States is unlikely to help, Politico adds, as President Donald Trump remains in the White House.

Politico argues that Europe’s inability to secure long-term financing for Ukraine sends a dangerous signal to Moscow. Ukrainian President Volodymyr Zelenskyy has previously warned that only sustained financial resilience could weaken Russia’s incentive to prolong the war. Instead, the publication concludes, Europe’s divisions may reinforce Russian President Vladimir Putin’s belief that time is on his side.

By Vugar Khalilov