The European Union is barreling ahead with an audacious plan to finance Ukraine’s survival by leveraging frozen Russian sovereign assets—just as internal dissent, transatlantic friction, and Russian threats of retaliation push the bloc toward one of its greatest geopolitical stress tests since the Cold War.
With U.S. support waning under the Trump administration and Ukraine facing a projected €136 billion financing gap for 2026–2027, Brussels is trying to unlock a €90 billion “reparations loan” backed by frozen Russian Central Bank reserves. But the effort is tearing open political splits inside the EU and triggering warnings from Moscow that the plan amounts to economic “theft” and could even be treated as an “act of war.”
And nowhere is the internal European backlash more visible—or more consequential—than in Belgium.
Von der Leyen’s Gambit: A Loan Backed by Frozen Funds
Unveiled on December 3, the European Commission plan would allow the EU to borrow €90 billion against the €185 billion in Russian assets immobilized at Euroclear. Ukraine would only repay the loan once Russia pays war reparations. The scheme avoids outright confiscation, attempting to navigate around sovereign immunity while keeping the assets frozen indefinitely.
Key features of the plan: Total package: €165 billion, From Euroclear: €140B, From private banks: €25B. Allocation: €115B defense, €50B budget, Repayment: Only after Russia pays reparations, Legal shield: EU-wide solidarity guarantees, Target launch: Q2 2026
Supporters—including Germany, Sweden, and eastern EU states—call it strategic necessity. But Belgium, the country that actually holds most of the frozen assets, is not convinced.
Belgium’s Hardline Opposition: “Russia Will Not Be Defeated”
Belgian Prime Minister Bart De Wever has emerged as the most forceful critic of the reparations-loan plan. His government, and Euroclear itself, warn of severe legal risks, market instability, and geopolitical fallout.
And now De Wever has escalated the rhetoric dramatically.
“Talk of Russia’s defeat is a fairy tale.”
In an interview with La Libre, De Wever stated bluntly:
“The idea that Russia will be defeated is a fairy tale and a complete illusion.”
“No one in the West seriously believes Moscow will suffer a strategic failure.”
He further argued that:
“The frozen Russian assets will eventually have to be returned to the Kremlin.”
These comments represent one of the starkest acknowledgments from an EU leader that Europe may be quietly recalibrating expectations for the war’s outcome. It also cuts directly against von der Leyen’s position that Ukraine can still negotiate “from a position of strength” if Europe steps up funding.
Belgium’s fears: Massive lawsuits, systemic risk, and peace derailment
De Wever’s concerns, already detailed in his November 28 letter to von der Leyen, reflect deep unease:
Belgium could face tens of billions in claims from Russia.
Euroclear warns of long-term obligations and “structural risk.”
Seizing or leveraging the principal undermines future peace negotiations.
Without guarantees from all 27 EU states, Belgium refuses to proceed.
Belgium’s Foreign Minister Maxime Prévot echoed this, calling the reparations-loan option “the worst of all.”
With EU sanctions requiring unanimity, Belgium—and potentially Hungary—could derail the entire freeze-and-loan architecture.
The U.S. Factor: Cooperation or Competition?
Despite open displays of transatlantic unity, U.S. and EU strategies diverge sharply.
A leaked U.S. peace proposal shows Washington wants:
$100 billion of the frozen assets
Placed into a U.S.-led reconstruction fund
With America taking 50% of profits
And returning most of the frozen assets to Russia post-peace deal
EU diplomats were furious, calling it an attempt to hijack Europe’s leverage while forcing EU states to match the U.S. dollar-for-dollar.
The EU’s plan for a perpetual freeze contradicts the U.S. preference for a conditional return to Moscow as part of a settlement.
Moscow’s Fury: Threats of Retaliation and Warnings of War
The Kremlin has responded aggressively:
Putin calls it “theft” and promises “reciprocal measures.”
Russia threatens to seize €12 billion in EU assets inside Russia.
VTB’s Kostin warns of “50 years of litigation” and economic warfare.
Kremlin officials suggest using the assets constitutes an “act of war.”
Russia has also widened hybrid retaliation—sanctioning EU journalists, restricting NGOs, and hinting at broader reprisals.
Europe’s Funding Crisis: No Good Options
The EU has already spent €197 billion supporting Ukraine since 2022. But Europe’s budget is strained, Germany faces recession, and Hungary rejects shared debt. Without frozen assets, Brussels has no clear way to fund Kyiv’s government and military beyond spring 2026.
Even optimists warn funds will only reach Ukraine in mid-2026—far too late without emergency bridge financing.
Ukraine welcomes the proposal but rejects EU pressure to buy European-made weapons, insisting it must retain the ability to purchase U.S. systems like Patriots.
A Continent at the Brink
Von der Leyen frames the issue starkly: Europe must step up or risk Ukraine’s collapse. But De Wever’s remarks strike at the heart of EU unity, raising an unspoken question now circulating in Brussels:
What if a growing number of European governments no longer believe Russia can be defeated?
If EU consensus collapses in December:
Ukraine loses leverage in U.S.-Russia negotiations
Kyiv might be forced into concessions
The EU’s internal cohesion could fracture
Russian threats may become more targeted and aggressive
The debate over frozen assets has become a referendum on Europe’s strategic will. What Brussels sees as a moral obligation, Moscow portrays as aggression—and Belgium now openly suggests the assets must eventually return to Russia.
Europe’s gamble is enormous, the risks escalating, and the clock ticking. Whether this ends as a bold act of solidarity or a trigger for broader conflict may depend on what happens in the weeks ahead.