EU Proposes Using Frozen Russian Assets to Fund Ukraine Defence

European Commission President Ursula von der Leyen has urged the European Union to explore fresh financing options for Ukraine's defense against Russian aggression by utilizing the cash balances associated with Russian assets frozen in European territories.

Though von der Leyen assured that the capital of these assets would remain untouched, she emphasized the necessity for EU nations to collectively share the risks associated with this novel financial framework intended to support Ukraine. This approach would provide Ukraine with a Reparations Loan, repaid once Russia compensates war damages.

Belgian officials, alongside those of other EU member states, remain cautious about seizing frozen Russian assets or hiking risk levels, as it may trigger legal challenges and instability within financial markets. Discussions with the European Commission are ongoing as the specifics of the proposed reparations loan are scrutinized.

(With inputs from agencies.)