EU confirms France and Italy’s support for Ukraine package won't affect national debt
Photo: statistical office of the European Commission (uk.wikipedia.org)
France and Italy have received confirmation that their participation in the EU's new credit package supporting Ukraine will not affect their national debt levels, Politico reports.
Eurostat explained that the financial guarantees underpinning the €210 billion loan backed by frozen Russian assets in Belgium are classified as "contingent liabilities."
This means they will only appear in the countries’ debt statistics if the guarantees are actually triggered - a scenario considered unlikely. The clarification addresses key concerns in Paris and Rome that signing the deal could undermine investor confidence and increase borrowing costs.
For France and Italy, this is critical, as EU leaders will discuss the loan package next week, which will determine Ukraine's financial stability in 2026.
The European Commission proposes spreading the risk across all member states to secure the loan in case Russia manages to reclaim its frozen funds held in the Euroclear system.
The letter emphasizes that none of the conditions that could transfer financial responsibility to member states "would be met." The actual burden of the guarantees will fall on the European Commission itself.
Germany is initially expected to provide the largest share of guarantees - over €52 billion. This sum may rise, as Hungary has already refused to participate in the mechanism.
Belgium has also maintained its position, seeking broader security guarantees against potential Russian countermeasures.
The biggest risk to the initiative remains the possible unfreezing of Russian assets if certain countries, such as Hungary or Slovakia, refuse to support sanctions.
Extending sanctions requires unanimity, and any blockage could force the EU to return funds to Russia. To prevent this scenario, a legal mechanism has been proposed, which is under discussion among diplomats and will be addressed at the upcoming EU ambassadors’ meeting.
Eurostat described the risk of the guarantees being triggered as "a complex event with no obvious probability."
Financial support for Ukraine
The €210 billion financial package is a key part of the long-term support plan for Ukraine, intended to sustain its army and economy in the event of a protracted war.
Frozen Russian assets in the EU, primarily in the Euroclear system, form the main financial foundation of the mechanism, but their status depends on EU sanctions decisions.
Hungary and Slovakia have repeatedly blocked or threatened to block sanctions, creating risks for the stability of the entire funding program.
EU leaders will discuss the mechanism at next week’s summit. Failure to reach an agreement could jeopardize Ukraine’s financial support in 2026.
Reparations loan – obstacles to agreement
Most frozen Russian assets are held in Belgium, whose government opposes their use due to high risks and potential complications for the peace process.
Earlier, German Chancellor Friedrich Merz visited Brussels to persuade Belgian Prime Minister Bart De Wever to support the initiative, but no change in Belgium’s position occurred during a working dinner with Ursula von der Leyen.
France has also stated it is unwilling to include Russian assets held in French private banks worth around €18 billion in the planned reparations loan.
The main burden of guarantees will fall on Germany, France, and Italy: Germany approximately €51.3 billion, France €34 billion, and Italy €25.1 billion.
