Member states may need to raise billions in joint debt if using frozen Russian assets for a “reparations loan” fails, sources told the outlet
EU countries could be asked to raise tens of billions in joint debt to finance Ukraine if an initiative to use frozen Russian assets for a “reparations loan” fails, Politico reported on Monday, citing diplomatic sources.
According to the report, several leaders discussed this alternative at last week’s EU summit after Belgium refused to back a €140 billion ($160 billion) Ukraine loan secured by the frozen Russian assets.
Although the details of the new plan remain unclear, joint debt typically refers to shared borrowing through jointly issued bonds by multiple nations, where all participants share responsibility for repayment.
Sources said the European Commission will outline the borrowing plan in an upcoming paper alongside a revised “reparations loan” proposal, and will include a third option – to halt Ukraine funding. They suggested the idea could be a “scarecrow” tactic to push EU nations already burdened by debt to vote for using the Russian assets.
Western nations froze $300 billion in Russian sovereign assets in 2022 and have sought to use the interest the funds have generated to finance Kiev’s war effort.
The G7 previously supported using the immobilized funds to secure $50 billion in loans, but EU leaders last week failed to agree on a similar “reparations loan,” largely due to Belgian opposition.
Prime Minister Bart De Wever warned that Belgium, which holds most of the frozen assets, could face disproportionate retaliation from Russia, and demanded a solid legal basis for the move and shared responsibility.
Sources told Politico that despite legal concerns, Brussels views using frozen Russian assets as the “most preferred” option to keep funding Kiev. A final decision is expected at the European Commission summit in December.
Moscow has denounced the asset freeze and attempts to redirect Russian funds as “theft,” vowing retaliation and warning that the move will erode trust in the Western financial system. The Kremlin has also said Western aid to Kiev only prolongs the conflict without changing the outcome.
