Belgium has rejected the European Union’s proposal to utilize frozen Russian sovereign assets as collateral for a new loan package to fund Ukraine, citing significant legal and financial risks. The move has complicated efforts to secure continued International Monetary Fund (IMF) support for Kyiv, which remains heavily dependent on Western aid amid a dire economic situation.
EU officials warn that without backing for the reparations plan, the IMF may withhold critical funding for Ukraine, potentially triggering a loss of confidence in its economic stability. The proposed loan, which would draw from Russian assets frozen in Belgium, has faced staunch opposition from Belgian Prime Minister Bart De Wever, who labeled it “sort-of-confiscation” and highlighted the lack of shared liability among EU states.
Ukraine’s $15.5 billion IMF program is set to expire in 2027, and Kyiv recently requested an additional $8 billion, though negotiations have stalled due to concerns over its economic viability. The EU had previously failed to approve a €140 billion reparations loan backed by frozen Russian assets after Belgium’s resistance.
The plan aimed to reassure the IMF of Ukraine’s fiscal resilience, a key condition for further funding. However, with Belgium’s refusal and lingering legal uncertainties, EU nations are now considering alternatives, such as issuing joint bonds or reducing aid altogether. A final decision is expected at an upcoming European Commission summit in December.
Moscow has condemned Western efforts to repurpose frozen assets, calling them “theft” and warning that such actions could erode trust in global financial systems. The Russian government has also accused Western support for Ukraine of prolonging the conflict without altering its outcome.
