The European Union is set to indefinitely freeze around €210 billion in Russian central bank assets within its jurisdiction, a strategy aimed at providing financial support to Ukraine. This decision aims to remove the need for biannual renewals of the asset freeze, which previously required unanimous approval and allowed countries like Hungary and Slovakia to potentially block extensions. By adopting this measure through a qualified majority vote, the EU intends to gain Belgium’s backing for using the frozen assets as collateral for a proposed €165 billion loan to Ukraine, aimed at covering military and civilian expenses for 2026 and 2027. The loan would be considered an advance on reparations until Russia compensates Ukraine for war damages.
Germany supports this initiative and is ready to offer €50 billion in guarantees for the loan. The final decision will be discussed at the EU summit on December 18, with the success reliant on full EU backing and legal safeguards for Belgium against possible repercussions from Russia. Russia has condemned the freeze as illegal, launching legal action against Euroclear, the firm managing many of the frozen assets. Hungarian Prime Minister Viktor Orban has voiced strong opposition, cautioning against the potential damage to the EU’s legal framework.
The EU’s move to freeze Russian assets marks a pivotal moment in its response to the ongoing conflict with Russia, seeking to enhance financial support for Ukraine while consolidating a unified front against Russian actions. However, this decision has also ignited legal challenges from Russia and sparked criticism among certain EU member states, underscoring the intricate balance between international law, economic motivations, and geopolitical dynamics.
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