Seven EU countries insist on a reparations loan for Ukraine
8 December 14:32
The prime ministers of Estonia, Finland, Ireland, Latvia, Poland and Sweden, as well as the president of Lithuania, sent a letter to European Commission President Ursula von der Leyen and European Council President Antonio Costa expressing support for the frozen assets of Russia in the EU.
“In addition to being the most financially feasible and politically realistic, this decision provides for the basic principle of Ukraine’s right to compensation for damages caused by aggression,” the letter, dated Sunday, December 7, reads, citing DW.
The authors of the appeal emphasize that if the decision on the reparations loan is approved during the EU summit in December, Ukraine will be in a stronger position to defend itself and negotiate a “just and long-term peace.”
According to Politico, Germany will be the largest guarantor of a possible reparations loan to Ukraine. The European Commission hopes that Berlin will agree to guarantee more than 50 billion euros to persuade Belgium to transfer 185 billion Russian assets frozen in the Belgian depository Euroclear to Ukraine, the article says. It is also assumed that France and Italy will provide guarantees for 34 and 25 billion, respectively.
Merz calls on EU countries to support the European Commission’s plan and share risks
on December 3, German Chancellor Friedrich Merz, in a guest article in the Frankfurter Allgemeine Zeitung (FAZ), called on EU countries to support the proposal to use Russian assets to lend to Ukraine, sharing all risks and legally enshrining these obligations. According to him, this would send an unambiguous signal to Moscow, which is preparing for a military conflict with the West and threatens the freedom and security of Europe.
“This is a signal not to continue this war, but to end it. We will send a signal of European independence, a signal that we, Europeans, determine and decide what happens on our continent,” he wrote.
After Russia’s full-scale invasion of Ukraine, Western countries froze Russian assets worth about 210 billion euros. The European Commission proposed to use 140 billion euros of them to provide Ukraine with a so-called “reparations loan”. According to this plan, legally, the funds should not be confiscated, but Russia will be able to return them only after paying reparations to Ukraine. And Ukraine would use the reparations paid by Russia to repay the reparations loan received from the EU.
Meanwhile, the Belgian Prime Minister, in a letter to the President of the European Commission, called the scheme “fundamentally wrong” and dangerous. He emphasized that it would undermine the credibility of Euroclear, which holds frozen Russian assets. Despite the legal wording, investors will perceive this model as a confiscation of assets entrusted to the depository, according to Belgium.
