Europe Debates Seizing €250 Billion Russian Assets Amid US Aid Suspension to Ukraine
March 4, 2025
Support for the seizure of these frozen funds is gaining momentum among leaders from the UK, Estonia, Poland, and Finland, indicating a potential shift in strategy.
There is also a debate among European leaders about whether to use these frozen assets as immediate support for Ukraine or to retain them as leverage for future peace negotiations with Russia.
EU's top diplomat, Kaja Kallas, has expressed support for utilizing the frozen assets, highlighting a formal request from Ukraine for this crucial assistance.
The suspension of U.S. aid to Ukraine has raised significant concerns in Europe regarding military support against Russia, leading to discussions about utilizing €250 billion of frozen Russian assets held by the EU.
Since February 2022, the EU has frozen approximately $300 billion in Russian funds, which are earmarked for Ukraine's post-war reconstruction.
In a related development, G7 nations have agreed to provide a $50 billion loan to Ukraine, funded by profits from the frozen Russian assets, which is already being delivered.
The urgency to access these funds has intensified following Donald Trump's decision to halt military assistance to Kyiv, prompting calls for their release to bolster Ukraine's defense.
French Economy Minister Éric Lombard explained that the frozen assets still legally belong to Russia due to the principle of 'sovereign immunity,' preventing their confiscation under international agreements.
European nations are currently leveraging profits from these frozen assets, estimated at €2.5 to €3 billion annually, to assist Ukraine with military needs and reconstruction efforts.
Despite strong advocacy from European leaders, including Polish Prime Minister Donald Tusk and EU foreign policy chief Kaja Kallas, legal complexities surrounding the seizure of these assets pose significant challenges.
Estonian Foreign Minister Margus Tsahkna has emphasized the need for Europe to expedite assistance to Ukraine, arguing that legal barriers to using the frozen assets are unfounded.
However, some analysts warn that seizing these assets could set a concerning precedent, potentially deterring foreign investment in the eurozone.
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Business Insider • Mar 3, 2025
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