Brussels proposes using frozen Russian funds to arm Ukraine

BrusselsDonald Trump's hardening of the tone against Vladimir Putin has given wings to the European Union for increase sanctions against Moscow and aid to Kiev. The European bloc and the United States have confirmed that the Kremlin has no desire to achieve peace, and after months in which the focus of the debate was negotiations for a potential truce, Washington and Brussels are once again talking about how to increase pressure on the Kremlin and ensure that Ukraine can continue to defend itself against the Russian invasion. Both powers have agreed—for the first time with Trump—to increase restrictions on the Russian regime, and this Tuesday, Ursula von der Leyen proposed providing zero-interest loans through frozen Russian funds in Ukraine.

The use of this Russian-origin money located on EU territory is highly controversial, and within the European bloc itself, there are voices and member states that are reluctant. This is a measure that has been looming over European institutions for years and has not yet been approved due to the legal doubts it raises. Until now, the EU has used the proceeds from these funds to help Ukraine, but now Von der Leyen has gone a step further and, for the first time, proposed giving Kiev a large portion of that money in the form of a loan.

Specifically, Brussels proposes redirecting €140 billion of the €180 billion in Russian assets frozen by the EU to Ukraine. However, to allay the concerns of some member states, Von der Leyen told the press on Tuesday that Kiev should return the funds to Russia if the Kremlin contributes to Ukraine's reconstruction.

The European Commission intends for Ukraine to use this money for humanitarian aid and to strengthen and renew its military capabilities. However, Brussels believes it can also profit from it, and Von der Leyen has indicated that a large part of these funds will be used to purchase weapons from European companies and, therefore, to strengthen the EU's war industry and its arms production capacity, which is one of the objectives that the self-proclaimed bloc has set for itself for empowerment.

The reluctance of member states

The measure has raised doubts in several member states from the outset, but the need to dig deep to help Ukraine and the apparent return of the United States to its side have led some governments to change their minds. For example, according to some international media, Germany, the largest and most influential country in the EU, has changed its position and is now open to accepting the initiative promoted by Von der Leyen.

Just as was the case with the use of the proceeds from the funds, most Eastern Bloc countries are now pushing to allow Ukraine to use all of the assets, even if it is in the form of loans and with conditions. However, some member states are once again more reluctant, especially those that feel the threat of Russian expansionism is more distant and are adopting a less bellicose tone with Putin. One of the countries that has taken the clearest position in this regard is Belgium, which receives around 1.3 billion euros annually in taxes because the assets are managed by a Belgian investment fund, Euroclear.

Von der Leyen wants to put this proposal on the table at the summit of EU heads of state and government to be held this Wednesday in Copenhagen, and plans to formally present the legislative proposal next November. Among other things, European leaders will also discuss how to increase sanctions against Putin and the bloc's rearmament plan. As for Gaza, it is not on the agenda, but diplomatic sources assume that they will eventually talk about the Israeli offensive and the peace plan agreed between Trump and Benjamin Netanyahu.