The EU agrees to issue common debt to help Ukraine after failing to reach an agreement to use Russian funds

BrusselsIt was meant to be another historic European summit. A further demonstration of the European Union's unprecedented support for a third country, Ukraine, in its fight against Russian expansionism, which threatens the security of the entire continent. The way to send this message was to... a loan of 90 billion to Kiiv with the frozen Russian funds that the European blog holds as collateral. The perfect way to make Moscow pay for its mistakes and, at the same time, avoid digging even deeper into their pockets. And, as an aside, they responded to Donald Trump that no, they are not "weak" leaders, and that they deserve a seat at the peace negotiations, as well as being willing to take risks and play a key role on the international stage. But there has been no agreement.

All the efforts of the last few days and sixteen hours of negotiations by European leaders at the European Council this Thursday have been completely in vain. Belgium has not yielded. The Bart De Wever's government has completely shut down, And the rest of the heads of state and government finally surrendered around 2:00 a.m. It was then that they decided to explore other options at the request of France and Italy, according to reports. Financial Timesand have agreed to issue joint debt to provide a loan to Ukraine with the backing of the European Union. A temporary solution until they agree on long-term financing for Volodymyr Zelensky's government. Specifically, Ukraine will be provided with the same amount, €90 billion, over the next two years, through a loan supported by the EU budget.

This represents a setback, especially for Germany. European Commission President Ursula von der Leyen and German Chancellor Friedrich Merz, who was heavily involved in the negotiations, did not get their way. A major defeat for the two German leaders, who also failed to secure ratification of the EU-Mercosur trade agreementUkrainian President Volodymyr Zelenskyy posted a brief message of thanks on social media, emphasizing that the debt issuance would provide "significant support" that would strengthen Ukraine's stability. He added, "It is important that Russian assets remain frozen and that Ukraine has received guarantees of financial security for the coming years." Zelenskyy, who participated via videoconference in the last European summit of the year, had warned that if the EU did not approve the release of Russian assets, Ukraine would have "a major problem" continuing to finance its defense war against Russia.

Legal doubts and economic risks

Belgium has blocked the use of these funds because 85% of the €210 billion in Russian funds held by the EU are in a Belgian depository, Euroclear, and Bart De Wever's government fears it will have to bear the potential consequences of a measure that raises concerns. And the Belgian government's fears are by no means unfounded.

The first time the European Commission proposed this initiative, several member states, including Germany and France, expressed reservations because they feared it would violate international law and, in the worst-case scenario, that the EU would end up having to return the money to Moscow. In fact, the Bank of Russia considers it an "illegal confiscation" and has already filed a complaint with the Russian courts regarding the permanent freezing of these funds.

Beyond the legal concerns, Belgium also notes that the measure could pose economic risks to the EU and the credibility of the euro. The president of the European Central Bank (ECB), Christine Lagarde, herself expressed her opposition and warned on Thursday that the measure could violate the European Union's own treaties. "Respect for the rule of law is one of the defining characteristics of our democracy," the French leader reminded everyone, who was not invited to the European Council meeting this time. However, European leaders are not giving up and assure that they will continue working to guarantee long-term, sustainable financing for Ukraine. In other words, the €90 billion loan to Kyiv is a temporary solution until a permanent one is found. "The EU reserves the right to use frozen Russian funds," European Council President António Costa emphasized early Friday morning. Leaders celebrate the victory

Despite European leaders leaving the meeting without an agreement on the use of Russian funds, they celebrated a victory. "We made a commitment and we delivered," said Costa, who sent a clear message to Putin: "Europe has been, is, and will stand with Ukraine for as long as necessary." Von der Leyen's words were also positive, contrasting sharply with the atmosphere of defeat that permeated the EU Council building in Brussels at four in the morning. "We have secured funding for the next two years," the President of the European Commission insisted. Even Merz suggested that everything had gone smoothly. "Good news for Ukraine and bad news for Russia," the Chancellor remarked.

However, aside from the fact that the Russian funds were not used, the agreement also excludes three member states: the two suspects The usual suspects, Hungary and Slovakia, and a new country joining the club of pro-Russian European partners, the Czech Republic. These three countries, whose leaders posted a picture on social media celebrating the summit's outcome, will not participate in sending the money to Ukraine through a joint loan.

On the other hand, the only leader who truly declared victory was the Belgian Prime Minister, who left the meeting early and rushed to meet with journalists. "Ukraine has won, Europe has won," said De Wever. Furthermore, he dashed any hopes his counterparts had regarding the use of the Russian funds, at least for the near future. "It's unrealistic to think we'll be discussing this again in January," warned the Belgian Prime Minister.