EU's proposal to utilize seized Russian funds for Ukraine's reconstruction denied by Belgium
The European Union (EU) is progressing with the work on the utilisation of the frozen Russian assets, following the 2022 invasion of Ukraine. This was announced by EU Chief Ursula von der Leyen during a visit to Estonia on Saturday.
In a similar vein, EU Foreign Policy Chief Kaja Kallas emphasised the importance of exploring all available avenues while minimising potential risks, during talks with EU foreign ministers in Denmark. Kallas made it clear that the focus should be on holding Russia accountable for war damages, while also addressing Ukraine's financing gap.
The EU has frozen €200 billion of Russian central bank assets, with the majority of these assets held by the international deposit organization Euroclear in Belgium. Last year, the European Union, along with its G7 partners, used the interest earned on the frozen Russian assets to back a US$50 billion loan to Ukraine, with the loan still being paid out in instalments.
Von der Leyen emphasised that Russia, the "predator," should pay for what it did, while Kallas reserved the use of the frozen assets until Russia fully compensates Ukraine for war damages. However, no details were provided about any potential risks associated with the use of these frozen assets, or the potential risks associated with their use to aid Ukraine.
The decision to freeze Russian assets and the potential use of these assets to aid Ukraine is facing opposition from key player Belgium. No specific options for the use of frozen assets were detailed in the given paragraph, but mooted options include confiscating them outright or investing them in riskier ventures.
There is pressure from some EU states to make more use of the frozen Russian assets. The need for accountability and aid for Ukraine is paramount, as the EU ministers acknowledged. Kallas emphasised the importance of preparing for a possible ceasefire or peace agreement, without returning the assets if no reparations are paid.
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