EU States Push to Revive Russian-Asset ‘Reparations Loan’ for Ukraine

A group of EU countries is pushing Brussels to revive a stalled plan to use frozen Russian assets to finance Ukraine, as Kyiv faces a growing wartime budget shortfall. Sweden, the Netherlands, Spain, and Poland are among the countries urging the European Commission to restart work on a proposed “reparations loan” and report on possible legal and technical ways to overcome Belgium’s opposition, the Financial Times (FT) reported on Thursday, citing four people familiar with the document.JOIN US ON TELEGRAMFollow our coverage of the war on the @Kyivpost_official. The plan collapsed in December after Belgium objected. Almost all of the €210 billion ($244 billion) in Russian assets frozen in Europe are held at Euroclear, a Brussels-based securities depository. Instead, the EU agreed to provide Ukraine with a €90 billion ($104 billion) loan backed by the bloc’s budget. EU governments also pledged to keep working on a separate reparations loan based on cash balances linked to the frozen Russian assets. But little has changed since then, according to one FT source. The renewed push comes as Ukraine faces mounting financial pressure after bringing forward spending to sustain its military campaign. President Volodymyr Zelensky said Monday that the defense ministry faces a €23.1 billion ($26.8 billion) funding gap that needs to be covered to keep the war effort going. Ukraine shifted spending originally planned for the second half of the year into the first six months, helping fund a major campaign of medium- and long-range strikes against Russian military positions, logistics hubs and supply routes, including those serving occupied Crimea. Other Topics of Interest How Russia Finds the Cracks in American Society – and Widens Them Russia has a well-developed playbook for influence operations. Laura Loomer got sucked into one and eventually realized what happened. The move has now left the defense ministry short of cash for military salaries, social support and weapons purchases. It also needs about €6 billion ($7 billion) in advance payments for weapons deliveries planned for early 2027. Ukraine urgently needs additional funding as Russia continues its near-daily missile and drone attacks. Kyiv also needs to develop and produce interceptor missiles capable of defending against Russian ballistic missile strikes. Swedish Foreign Minister Maria Malmer Stenergard said the time was right to reconsider how frozen Russian assets could be used. “It is a fair and reasonable way to ensure that Ukraine can defend itself and all of Europe,” she said. The EU has so far been unable to find a way around Belgium’s concerns over the legal and financial risks of using the frozen assets. Zelensky has asked the EU to accelerate part of the €90 billion loan ($104 billion), with half scheduled for this year and the remainder next year. Brussels fears that changing the arrangement could undermine the fragile agreement on financing Ukraine and force the bloc to find additional money. Still, an EU official familiar with the discussions told the FT that the bloc could revisit existing legal proposals if political conditions change. Kyiv Post is Ukraine’s first and oldest English news organization, reporting since 1995. Its international reach – 97% of readers are outside of Ukraine – make it truly Ukraine’s global voice.