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Belgium hits back at EU plan to use frozen Russian assets to aid Ukraine
Belgium has hit back against an EU plan to use Russia’s frozen assets to aid Ukraine, describing the scheme as “fundamentally wrong” and throwing into doubt how Europe will fund Kyiv. In a sharply worded letter, Belgium’s prime minister, Bart De Wever, said the proposal violated international law and would instigate uncertainty and fear in financial markets, damaging the euro. “These risks are unfortunately not academic but real,” he wrote to the European Commission president, Ursula von der Leyen.
Belgium hosts €183bn of Russian assets, about two-thirds of the Russian assets immobilised in the west, at the Brussels-based central securities depository Euroclear.
The Belgian government said it wanted to see a legal text and has faulted the lack of detail about risk-sharing with the other 26 member states if the plan goes wrong. Brussels has also called for legal proposals on common EU borrowing to fund Ukraine, using unspent funds in the EU budget as the guarantee. De Wever argues this option would be cheaper than using the assets, once the risks are factored in.
The commission has suggested money for Ukraine could be funded by common borrowing on capital markets, but member states are unenthusiastic. Germany, Sweden, as well as central and eastern European states and von der Leyen, argue the frozen assets plan is the best option. The commission says the scheme does not equate to confiscation of the Russian assets.
EU diplomats admit the plan is fraught with complexity, not least because it requires a unanimous decision – including Hungary’s Kremlin-friendly government – to ensure the Russian assets remain frozen in perpetuity. Some say that even under a best-case scenario the frozen assets plan could take months to yield funds for Ukraine and that other short-term bridging loans could be needed.