🔗 Share this article Russia Retaliates at Europe's Scheme to Lend Immobilized Moscow's Cash to Kyiv Ukraine is depleting its cash to keep going its armed forces and economy afloat, after close to 48 months of Russia's full-scale war. From the EU's perspective, the remedy to plugging Ukraine's financial shortfall of €135.7bn for the coming 24 months rests with Moscow's immobilized funds located within Belgian bank Euroclear, and EU leaders aim to give it the green light at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an act of theft, and Russia's central bank stated on Friday it was taking to court Euroclear in a Moscow court even before a final decision is made. 'Only Fair' to Utilize Russia's Funds, Say Ukraine and the EU In total, Russia has approximately €210bn of its assets frozen in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that that capital should be used to reconstruct what Russia has destroyed: Brussels refers to it as a "reconstruction loan" and has come up with a plan to support Ukraine's economy to the tune of €90bn. "It is only just that Moscow's blocked funds should be used to rebuild what Russia has destroyed – and that money then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. Germany's leader Friedrich Merz states the assets will "allow Ukraine to defend itself efficiently against future Russian attacks". Moscow's lawsuit was foreseen in Brussels. But it is not only Moscow that is concerned. The Belgian government is concerned it will be left with an massive bill if it all backfires, and Euroclear CEO Valérie Urbain warns using the assets could "disrupt the international financial system". Euroclear also has an approximate €16-17bn locked in Russia. The leader of Belgium Bart de Wever has set the EU a series of "rational, reasonable, and justified conditions" before he will accept the reparations plan, and he has left open the possibility of legal action if it "poses significant risks" for his country. The Details of the EU's Proposal? Brussels is under pressure prior to next Thursday's summit to agree on a compromise that Belgium can agree to. Previously the EU has held off touching the frozen capital directly but for the past year has transferred the "extraordinary revenues" from them to Ukraine. In 2024 that was €3.7bn. Juridically, using the interest is considered permissible as Russia is sanctioned and the returns are not Russian sovereign property. But global military support for Ukraine has fallen significantly in 2025, and Europe has had trouble trying to compensate for the gap resulting from the US decision to virtually halt funding Ukraine under President Donald Trump. There are currently two EU proposals aimed at furnishing Ukraine with €90bn, to cover a large portion of its financial requirements. The first is to borrow the funds on the markets, secured against the EU budget as a guarantee. This is Belgium's first choice but it demands a agreement by all by EU leaders and that would be difficult when Budapest and Bratislava are against funding Ukraine's military. The alternative is lending Ukraine cash from the frozen Russian funds, which were at first held in financial instruments but have now largely turned into cash. That money is an asset of Euroclear located within the European Central Bank. Brussels' executive arm accepts Belgium has justified fears and claims it is convinced it has addressed them. The scheme is for Belgium to be protected with a assurance applying to all the €210bn of Russian assets in the EU. If Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered from assets belonging to Russia's own settlement agency which are in the EU. Should Russia went after Belgium itself, any ruling by a Russian court would not be enforced in the EU. In a significant move, EU ambassadors are set to approve on Friday to freeze indefinitely Russia's central bank assets held in Europe for the foreseeable future. Previously they have had to vote all together every six months to continue the freeze, which could have meant a ongoing risk to Belgium. The EU ambassadors are planning to use an special provision under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "clear risk to the financial well-being of the union" continues. Why Belgium is Not Yet On Board The Belgian government is insistent it remains a strong supporter of Ukraine, but sees legal risks in the plan and worries about being shouldering the repercussions if things fail. A typically partisan political environment in this case has united behind Prime Minister Bart de Wever, who is under pressure from European colleagues. "Belgium has a modest-sized economy. Belgian GDP is around €565bn – consider if it would need to carry a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to arrange sufficient assurances for the loan itself, Belgium fears an added risk of being subject to extra legal costs. Prof Colaert also contends the requirement for Euroclear to grant a loan to the EU would breach EU banking regulations. "Banks need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these bank rules? It's because we want banks to be solvent. And if things fail it would fall to Belgium to bail out Euroclear. That's another reason why it's so vital for Belgium to secure ironclad protections for Euroclear." The European Union Facing Strain from Every Direction There is no time to lose, warn a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the most economically realistic and politically realistic solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "Should we not succeed, I don't know what we'll do afterwards. That's why we have to finalize the deal in a week's time". While Russia is adamant its money should not be accessed, there are added concerns among EU officials that the US may want to employ Russia's frozen billions in another way, as part of its own peace plan. Zelensky has said Ukraine is coordinating with Europe and the US on a recovery fund, but he is also aware the US has been holding discussions with Russia about possible partnership. An initial document of the US peace plan suggested $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving
Ukraine is depleting its cash to keep going its armed forces and economy afloat, after close to 48 months of Russia's full-scale war. From the EU's perspective, the remedy to plugging Ukraine's financial shortfall of €135.7bn for the coming 24 months rests with Moscow's immobilized funds located within Belgian bank Euroclear, and EU leaders aim to give it the green light at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an act of theft, and Russia's central bank stated on Friday it was taking to court Euroclear in a Moscow court even before a final decision is made. 'Only Fair' to Utilize Russia's Funds, Say Ukraine and the EU In total, Russia has approximately €210bn of its assets frozen in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that that capital should be used to reconstruct what Russia has destroyed: Brussels refers to it as a "reconstruction loan" and has come up with a plan to support Ukraine's economy to the tune of €90bn. "It is only just that Moscow's blocked funds should be used to rebuild what Russia has destroyed – and that money then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. Germany's leader Friedrich Merz states the assets will "allow Ukraine to defend itself efficiently against future Russian attacks". Moscow's lawsuit was foreseen in Brussels. But it is not only Moscow that is concerned. The Belgian government is concerned it will be left with an massive bill if it all backfires, and Euroclear CEO Valérie Urbain warns using the assets could "disrupt the international financial system". Euroclear also has an approximate €16-17bn locked in Russia. The leader of Belgium Bart de Wever has set the EU a series of "rational, reasonable, and justified conditions" before he will accept the reparations plan, and he has left open the possibility of legal action if it "poses significant risks" for his country. The Details of the EU's Proposal? Brussels is under pressure prior to next Thursday's summit to agree on a compromise that Belgium can agree to. Previously the EU has held off touching the frozen capital directly but for the past year has transferred the "extraordinary revenues" from them to Ukraine. In 2024 that was €3.7bn. Juridically, using the interest is considered permissible as Russia is sanctioned and the returns are not Russian sovereign property. But global military support for Ukraine has fallen significantly in 2025, and Europe has had trouble trying to compensate for the gap resulting from the US decision to virtually halt funding Ukraine under President Donald Trump. There are currently two EU proposals aimed at furnishing Ukraine with €90bn, to cover a large portion of its financial requirements. The first is to borrow the funds on the markets, secured against the EU budget as a guarantee. This is Belgium's first choice but it demands a agreement by all by EU leaders and that would be difficult when Budapest and Bratislava are against funding Ukraine's military. The alternative is lending Ukraine cash from the frozen Russian funds, which were at first held in financial instruments but have now largely turned into cash. That money is an asset of Euroclear located within the European Central Bank. Brussels' executive arm accepts Belgium has justified fears and claims it is convinced it has addressed them. The scheme is for Belgium to be protected with a assurance applying to all the €210bn of Russian assets in the EU. If Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered from assets belonging to Russia's own settlement agency which are in the EU. Should Russia went after Belgium itself, any ruling by a Russian court would not be enforced in the EU. In a significant move, EU ambassadors are set to approve on Friday to freeze indefinitely Russia's central bank assets held in Europe for the foreseeable future. Previously they have had to vote all together every six months to continue the freeze, which could have meant a ongoing risk to Belgium. The EU ambassadors are planning to use an special provision under Article 122 of the EU Treaties so the assets continue to be immobilized as long as an "clear risk to the financial well-being of the union" continues. Why Belgium is Not Yet On Board The Belgian government is insistent it remains a strong supporter of Ukraine, but sees legal risks in the plan and worries about being shouldering the repercussions if things fail. A typically partisan political environment in this case has united behind Prime Minister Bart de Wever, who is under pressure from European colleagues. "Belgium has a modest-sized economy. Belgian GDP is around €565bn – consider if it would need to carry a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to arrange sufficient assurances for the loan itself, Belgium fears an added risk of being subject to extra legal costs. Prof Colaert also contends the requirement for Euroclear to grant a loan to the EU would breach EU banking regulations. "Banks need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do precisely that. "What is the purpose of these bank rules? It's because we want banks to be solvent. And if things fail it would fall to Belgium to bail out Euroclear. That's another reason why it's so vital for Belgium to secure ironclad protections for Euroclear." The European Union Facing Strain from Every Direction There is no time to lose, warn a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the most economically realistic and politically realistic solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "Should we not succeed, I don't know what we'll do afterwards. That's why we have to finalize the deal in a week's time". While Russia is adamant its money should not be accessed, there are added concerns among EU officials that the US may want to employ Russia's frozen billions in another way, as part of its own peace plan. Zelensky has said Ukraine is coordinating with Europe and the US on a recovery fund, but he is also aware the US has been holding discussions with Russia about possible partnership. An initial document of the US peace plan suggested $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving