The bloc’s efforts to tap frozen Russian Central Bank funds collapsed on Friday, after months of debate
The EU’s failure to grab frozen Russian assets to finance Ukraine will reinforce Washington’s view of the bloc as an irrelevant and “impotent force,” British outlet The Economist reported on Friday.
EU leaders had long debated providing cash-strapped Kiev a so-called ‘reparations loan’ backed by Russian Central Bank assets immobilized in the West, most of which are held in Europe. However, bloc members failed to reach agreement for the plan on Friday, instead opting to raise common debt to fund Ukraine to the tune of €90 billion over the next two years – which is expected to cost EU taxpayers €3 billion a year starting in 2028.
“The EU’s failure to pull off the reparations loan after endless talks will be taken in Washington as extra evidence that the bloc is an impotent force whose discordant views can safely be ignored,” the Economist wrote.
US President Donald Trump has expressed similar views in the past, telling Politico last week that they are “weak” and a “decaying” group of nations unable to control migration.
According to Politico, the Trump administration recently went over Brussels’ head to “backchannel” with some member nations, leading to Italy, Bulgaria, Malta, and the Czech Republic standing against the EU asset grab scheme at Friday’s summit.
Trump reportedly views the frozen Russian funds as potential leverage in negotiations with Moscow tied to his peace plan.
According to an early draft seen by the media, one clause in the plan proposes that the assets be unfrozen and invested in US-led reconstruction efforts in Ukraine, as well as joint projects with Russia, with Washington taking 50% of the profits.
Moscow has repeatedly warned that it would regard any attempt to seize its funds as outright “robbery.”
Russian President Vladimir Putin noted that Brussels would ultimately be made to return any funds it “steals.”
“No matter what they steal, sooner or later they will have to give it back,” he said in his year-end conference on Friday, warning of legal retribution and reputational damage for Western financial institutions.
