Europe meets for '50-50' decision on Russian frozen assets

World watches EU as it faces unity test over Ukraine war

European Commission chief Ursula von der Leyen said she would not leave the summit without agreement on how to finance Ukraine over the next two years. AFP

European leaders who gathered in Brussels on Thursday have said they have a “50-50” chance of striking an agreement on using Russian frozen assets to help Ukraine.

The US was the latest country to oppose the move after a rejection from Belgium, where most of the funds are located, which might be joined by Italy, Bulgaria, Malta, Hungary and Slovakia.

“I don't think that we are going to move without Belgium feeling comfortable,” said the EU's foreign affairs chief Kaja Kallas, speaking as she arrived at the meeting. She added that she agreed with comments made on Wednesday by German Chancellor Friedrich Merz in which he said that “the chances of us achieving this are 50-50”.

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“We just ​can't afford to fail. We have to show that we are strong,” Ms Kallas said.

Discussions are expected to include Ukrainian President Volodymyr Zelenskyy and last two days, with a likelihood to spilling over into a third – an unusual occurrence.

In negotiations on the sidelines of the summit, Germany reportedly complied with Belgian demands to make ‌available assets held ‍in ‍Germany ⁠belonging to the Russian central bank to support Ukraine, the German news agency dpa reported. Other countries, including France, hold frozen Russian assets, though in smaller quantities than Belgium.

European Commission chief Ursula von der Leyen said she would not leave the summit without agreement on how to finance Ukraine over the next two years. “We have one ultimate goal in this European Council, and that is peace for Ukraine, peace through strength,” Ms von der Leyen said. “We have to find a solution.”

Belgium's Prime Minister Bart De Wever, left, speaks with Cypriot President Nikos Christodoulides at the EU summit. AP

European leaders have come under pressure from US Donald Trump, who has described them as weak, while Russian President Vladimir Putin on Wednesday said they were “little pigs”. He warned that if diplomacy failed then Russia would continue “liberating its historic lands” which are located within Ukraine's internationally recognised borders.

'Money today or blood tomorrow'

Some leaders struck an alarmist tone, with Poland's Prime Minister Donald Tusk saying that Europe had “a simple choice, either money today, or blood tomorrow”. Poland has been among the most exposed European countries to military spillover of the Russia-Ukraine war in the past two years.

Belgium was initially isolated in its vocal rejection of the plan at a previous meeting of EU leaders in October, but has since been joined but a number of states – and more recently by the US, according to British daily The Times. The report quoted a source close to internal US discussions saying that Washington believed that Europeans would have to “give the funds back” to Russia.

The US is understood to believe that the EU using the funds to extend a loan to Ukraine, which will run out of money by the end of the first quarter of 2026, would extend the war. Most of Europe views Russia's territorial ambitions in Ukraine as an existential threat.

There is a widely held belief among European leaders that Europe would not actually have to give the €210 billion ($246 billion) back to Russia because that would be conditioned on Moscow paying repairs for war damage to Kyiv – an unlikely outcome. The so-called reparations loan is the preferred option.

Russian president Vladimir Putin has described European countries as 'little pigs'. AFP

However Belgium fears being forced to pay the money back if Russia successfully sues in an international court. Few EU states have so far said they would consider the unlimited financial guarantees that Brussels is requesting.

The “whole idea is a stupid one”, said Hungary's Prime Minister Viktor Orban, Moscow's strongest EU ally. “The Belgian Prime Minister [Bart De Wever] is right, we should not do that,” he said, describing the plan as “killed”.

“It's over, there is no sufficient high-level support behind it,” he added.

Other European leaders, among them Ukraine's staunchest allies, struck a more optimistic tone. “We'll find a position,” French President Emmanuel Macron said. “Several options have ⁠been put forward by the European Commission and important discussions have been initiated on how to use these assets held by the Russians. What ⁠I ​mean here ‍is that we must bring ⁠everyone ‌together.”

Britain is prepared to share the risks with European allies of using frozen Russian assets to aid Ukraine, Downing Street indicated.

The UK Prime Minister’s official spokesman was asked on Thursday if the Government was willing to accept Belgium’s requests to share the risk of unlocking frozen Russian assets for use in Ukraine.

He indicated the Government would, telling reporters: “I think it’s evident within the Government’s actions that what we want to see is those immobilised assets used to support Ukraine.

“We believe that delivering these funds sends a very clear signal to Putin that he cannot outlast the support of the UK and our allies, that is what we remain focused on.”