European Commission unveils new options to finance Ukraine
Photo: European Commission President Ursula von der Leyen (Getty Images)
The European Union may consider alternative ways to finance Ukraine beyond using frozen Russian assets. Efforts to overcome the strong resistance of Belgium, the main holder of those assets, have so far failed, Politico reports.
European Commission President Ursula von der Leyen, during her speech before the European Parliament, for the first time suggested that there could be other funding options for Ukraine if the plan to create a reparations loan does not succeed.
Belgium, the largest holder of Russia's frozen assets (the Belgian depository Euroclear holds most of the Russian Central Bank's funds in the EU), is strongly opposed to the EU's idea of providing Ukraine with €140 billion using Russian assets. As a result, the EU is forced to look for alternatives. If Belgium’s resistance cannot be overcome, von der Leyen outlined two possible options to secure financing for Ukraine:
-
common EU debt backed by national capitals;
-
allowing each member state to finance Ukraine individually through their national budgets.
However, Politico notes that both options are problematic for "highly indebted" countries, such as France and Italy.
Von der Leyen said during her address that using Russia’s assets "is the most effective way to sustain Ukraine's defense and its economy. And the clearest way to make Russia understand that time is not on its side".
Ukrainian President Volodymyr Zelenskyy on November 13 urged the European Union to overcome differences regarding the use of frozen Russian assets, stressing that for Ukraine, it is a matter of survival.
Meanwhile, the European Commission is working on a new financial aid plan for Ukraine. Details of this plan have not yet been disclosed, and the creation of the much-anticipated reparations loan remains stalled due to Belgium's opposition.
