Four EU countries seek to reopen debate on Russian frozen assets for Ukraine

By Jan Strupczewski

BRUSSELS, Aug 27 (Reuters) – The Netherlands, Poland, Spain and Sweden called on Thursday for the European Union to reopen discussion next week on using Russia’s frozen assets for Ukraine as Moscow shows no signs of wanting to end its war there.

In a letter seen by Reuters, foreign ministers of the four countries argue that, while the EU agreed last December on a 90 billion euro ($104.86 billion) loan for Kyiv for 2026 and 2027, this will not be enough. 

“Ukraine needs more financial support in both the short and long term,” said the letter, addressed to EU foreign policy chief Kaja Kallas and Helen McEntee, the foreign minister of Ireland, which holds the EU’s rotating presidency.

“We believe now is the time to revert to the issue of how we can make further use of Russia’s immobilised assets for the benefit of Ukraine,” the ministers wrote. They want the issue to be discussed at the next EU foreign ministers meeting on Sept 1-2 in Ireland.

European Union countries immobilised some 210 billion euros of Russian central bank assets after Moscow invaded Ukraine in February 2022. Around 185 billion euros of this is held in Brussels-based central securities depository Euroclear.

The European Commission proposed last year to use the Russian cash for a loan of up to 165 billion euros to Ukraine, repayable only after Russia pays war reparations to Kyiv.

But Belgium rejected the plan, saying it did not provide sufficient guarantees that it would not be left alone to deal with potential lawsuits and demands of damages from Russia.

The plan to use the frozen assets was therefore dropped and replaced by the 90 billion euro loan, backed by the EU budget.

CHANCE OF AGREEMENT UNCLEAR

Officials said it was unclear if renewed talks would succeed since Belgium has not changed its position.

“We … propose that the Commission’s technical experts are invited to explore, in close consultation with Member States, new options on how to use the immobilised assets for the benefit of Ukraine,” the letter said.

Officials said some new momentum could come from ongoing negotiations over the next EU long-term budget for 2028-2034, which will have to include money for Ukraine.

The more money available from other sources, the less EU taxpayers will have to provide, officials said. Others noted the money would be better used to fend off Moscow than to rebuild after it lays waste to Ukraine.

“Russia will not get this money back until it pays reparations to Ukraine, so it is better to use it to stop the aggression — that is, to defend Ukraine — rather than wait until the end of Russia’s aggression to spend it on reconstruction,” Polish Foreign Minister Radoslaw Sikorski said.

($1 = 0.8583 euros)

(Reporting by Jan Strupczewski; editing by Philip Blenkinsop)