Why Belgium blocked the “reparations loan” for Ukraine and what it means
24 October 2025 08:51
The European Union planned to provide Ukraine with 140 billion euros in the format of a so-called “reparations loan,” a loan that would be secured by the proceeds of the frozen assets of the Russian Federation. However, Belgium unexpectedly blocked this decision, jeopardizing the financing of Ukraine’s defense and budgetary needs in 2026. This was reported by the Financial Times and Bloomberg, "Komersant Ukrainian" informs
What is a “reparations loan”?
This is not a seizure of Russian assets right now.
The money is provided to Ukraine in the form of a loan.
The loan is secured by the profits (interest) generated by frozen Russian property in European financial institutions, in particular in the Belgian depository Euroclear.
The assets remain frozen, but the interest is used to repay the loan.
Why Belgium is against it
Belgium has the largest amount of Russian assets in the EU – more than €190 billion – that are physically held in the country’s financial system. The Belgian government declares:
The country does not want to be legally responsible if Russia tries to challenge the mechanism in international courts in the future.
Belgium is demanding guarantees that it will not be forced to compensate these funds in the event of a losing outcome.
Prime Minister Bart de Wever said: “The legal framework is not a luxury, we cannot risk our citizens’ money.”
What EU leaders say
The European Council: recognizes the existence of “technical issues” but assures that assistance to Ukraine will remain a priority.
France: calls the loan a key support mechanism.
Germany: considers Belgium’s concerns to be serious and need to be addressed.
Ukraine: President Zelenskyy emphasized that funds are needed “in early 2026 to avoid financial collapse.”
Why this decision is critical for Ukraine
If the loan is not approved:
Ukraine risks not receiving funds for defense and social payments in 2026.
The EU may lose an instrument of economic pressure on Russia.
Postponing the decision until December 18 means a pause in the process, which increases the risk of a financial vacuum.
What happens next
EU leaders will return to the discussion on December 18.
Ukraine is actively lobbying for Belgium’s guarantees.
If a compromise is found, it will set a precedent for the use of Russian funds without legal confiscation.
What does this mean for Ukrainian citizens?
If approved, the country will receive resources for the army, pensions, and reconstruction.
In case of failure, the country will have to look for other sources of borrowing, possibly with the involvement of the IMF or the United States.
