Funding for Ukraine has become a major issue for the 27-member bloc, with the United States choking off its financial support while countries such as Hungary push for curbs on funding as well.
On the other side, Poland likened the situation to a choice between “money today or blood tomorrow.”
The EU summit came after Russian President Vladimir Putin crudely criticized the bloc’s leaders, using a word that can be translated as “young swine,” and reiterated assertions that Moscow will achieve the goals of its war on Ukraine by force if a US push for peace does not produce a deal that meets its demands.
Putin is scheduled to hold his annual press conference later on December 19 where he is likely to talk about the asset proposal. Russia had threatened massive legal action over any usage of its frozen assets.
Ukrainian President Volodymyr Zelenskyy attended the summit, telling leaders the proposal of a loan backed by the frozen Russia assets currently held in the EU is preferable, but that ultimately it doesn’t matter how the funds are utilized, just as long as a solution is found.
“If in the spring, Ukraine does not receive the corresponding tranche — which, in the event of peace, will be used for the country’s reconstruction, and in the event of continued war, for other priorities, above all drone production — Ukraine’s drone production will be reduced several fold,” he told reporters at a press conference after addressing the summit behind closed doors.
Ukraine currently faces a foreign aid shortfall of some $53 billion to $59 billion next year, he added.
Western countries have supported the war-torn country with both direct budgetary support and military aid since Russia’s full-scale invasion nearly four years ago, but the upcoming period may be different.
The United States has signaled that it most likely won’t send more cash, putting the onus on the EU and other G7 countries to step up — and to do so soon.
Some 140 billion euros ($165 billion) of Russian state assets are held in the Belgian-based financial markets company Euroclear, while an additional 25 billion euros of Russian state assets are held in banks across the EU, mainly in France but also in a Belgian private bank, Cyprus, and Germany.
The reparations loan is part of a wider financial package that is worth up to 210 billion euros, according to the European Commission. This also includes 45 billion euros that will be used to repay a G7 loan to Ukraine from 2024.
See Also: Second Day Of US-Ukraine Talks Expected In Berlin Amid Push For Peace Agreement
While most of the EU’s 27 members are in favor of using the assets to back the loan, Belgium fears the plan could leave it legally vulnerable, and other countries including Italy have also expressed doubts.
European Commission chief Ursula von der Leyen said she would not leave the summit without agreement on how to finance Ukraine over the next two years.
German Chancellor Friedrich Merz issued a stark warning earlier this week, saying failure would mean “the European Union’s ability to act will be severely damaged for years, if not longer, and we will show the world that we are incapable of standing together and acting at such a crucial moment in our history.”
In a combative speech at an annual Defense Ministry event on December 17, Putin sought to blame Europe and Ukraine in advance for any failure of the peace efforts, saying that Russia will take more land by force if Kyiv and European leaders he described as “young swine” do not take the right approach to US proposals.
“If the opposing side and their foreign patrons refuse to engage in substantive discussions, Russia will achieve the liberation of its historical lands by military means,” Putin said, pouring cold water on any proposal that calls for Moscow to make territorial concessions.
Moscow currently controls nearly one-fifth of Ukraine, and Russian officials have repeatedly said they won’t compromise on the five Ukrainian regions that Putin baselessly claims are Russian.
A particular sticking point in the weeks-long flurry of negotiations involving the US, Ukraine, Europe, and Russia has been the portion of the Donetsk region that Ukrainian forces still hold.
Copyright (c)2025 RFE/RL, Inc. Used with the permission of Radio Free Europe/Radio Liberty
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