Belgian Prime Minister Bart de Wever has stepped up his opposition to a European Union proposal to issue so-called reparation loans to Ukraine using idle Russian assets, calling the idea “fundamentally wrong.”
“Why would we enter unknown legal and financial territory with all its possibilities if we can avoid it?” de Wever wrote in a letter to European Commission President Ursula von der Leyen, seen by Euronews.
Instead of using Russian assets, the EU should jointly borrow 45 billion euros from the market to cover Kiev’s financial and military needs next year, he added.
“In reality, such an option will be cheaper than other options, especially the indemnity loan option, once all risks are taken into account,” he says.
De Wever also argues that the unprecedented reparations loan risks derailing the White House’s efforts to reach a peace deal between Ukraine and Russia, a view that clashes with other leaders who see the asset as Ukraine’s greatest lever.
“If we proceed too quickly with the proposed reparations loan scheme, the collateral damage would be to effectively prevent the EU from reaching a final peace agreement,” de Wever told von der Leyen.
“While we fully sympathize with the argument that European taxpayers should not be the only ones to foot the bill for financial aid to Ukraine, the cruel legal reality is that at no moment in history has sovereign assets immobilized during an ongoing war been ‘repurposed’.”
The bulk of Russia’s assets, amounting to around 185 billion euros, are held at the Brussels-based central securities depository Euroclear. Around 25 billion euros is distributed among private banks in other member states, but the amount was not disclosed.
Belgium, where Euroclear is based, is concerned that Euroclear could be singled out first for Moscow’s legal retaliation, making it liable not only for the entire loan but also for potential damages arising from a legal challenge, a theme De Webes highlighted in his four-page letter.
First of all, De Weber held out The proposals at a high-stakes summit in mid-October call for “full mutualization” of risk, guarantees of confidentiality from other member states, and maximum transparency to identify the whereabouts of the rest of Russian assets.
“Even if I receive money from our country, if it doesn’t work out, I cannot and certainly do not intend to pay 140 billion euros within a week,” De Weber said after the summit.
Since then, the European Commission has been in talks with Belgium to find solutions to a number of legal, financial and diplomatic issues regarding the loan.
Earlier this month, von der Leyen sent a letter He outlined to EU leaders three main options for supporting Ukraine’s budget and military needs: bilateral contributions from each country, common borrowing at EU level, or reparation financing based on Russian assets.
race against time
Most countries, including Germany, Poland, Scandinavia, and the Baltic states, have rallied behind reparations financing because, at least initially, their own treasuries can avoid paying for reparations and achieve the idea of “making Russia pay.”
On Wednesday, Ms. von der Leyen reiterated that her preferred vehicle is immovable Russian assets.
“Let me be clear: I cannot imagine a scenario where European taxpayers alone foot the bill. This is also unacceptable,” she told MPs.
“One more thing that must be made clear is that any decisions in this regard must be taken in accordance with the rules of the jurisdiction and respect European and international law.”
German Chancellor Friedrich Merz said Thursday that the decision on reparations financing could help give the EU a stronger say in the U.S.-led peace talks.
“We would like to further utilize these assets to support Ukraine,” Merz said.
The original 28 point plan included: controversial model It would use Russian assets for the commercial interests of Washington and Russia. The clause is believed to have been removed after talks between the US and Ukraine in Geneva.
The EU argued that the provisions relating to Russian assets under EU jurisdiction required the EU’s “full involvement.”
Meanwhile, Russian President Vladimir Putin said touching the funds amounted to “theft” and urged the government to take “countermeasures.”
The EU’s 27 leaders will meet in Brussels on December 18 and 19 to take the necessary decisions to approve Ukraine’s new plan with the International Monetary Fund.
In a letter to von der Leyen, Mr de Wever said that despite his many grievances, he had not completely closed the door on compensation financing.
In exchange for his blessing, he is demanding a “legally binding, unconditional, irrevocable, on-demand, joint and several guarantee” for both Belgium and Euroclear to cover 185 billion euros and potential arbitration costs.
“Some may believe that this is only a theoretical revelation. I argue to the contrary that this danger is real and likely to occur,” de Wever wrote.
“A successful legal challenge could have the most serious consequences,” he continues.
“Let’s use the analogy of a plane crash. Planes are the safest means of transportation and are unlikely to crash, but if they do, the consequences are dire.”
Moreover, de Wever warns that even though the proposal would allow Russia to recover assets if it agrees to compensate for the catastrophe caused by a war of aggression, the loan could be seen as an “illegal expropriation” by foreign countries and investors.
“Unfortunately, these risks are not academic, they are real,” de Wever wrote.
“If this regime is adopted, we should expect spillover effects on sovereign assets held by other non-EU countries within the EU, which could fundamentally call into question the willingness of such countries to hold assets in Europe.”
