EU countries reject Belgium's request for 'blank check' guarantee on Russian assets loan

EU Countries Reject Belgium"s Request for "Blank Check" Guarantee on Russian Assets Loan

In a significant development regarding European financial support for Ukraine, EU member states have declined Belgium"s request for a "blank check" guarantee related to a proposed loan scheme involving €140 billion in frozen Russian assets. This decision comes as Belgian Prime Minister Bart De Wever seeks assurances from fellow EU nations to mitigate the risks associated with the deployment of these immobilized assets, which are currently held in Brussels.

Key Details

Belgian Prime Minister Bart De Wever is advocating for EU countries to provide financial guarantees that would cover risks exceeding the €140 billion in frozen Russian assets. He has requested that these guarantees be available for immediate payout, potentially within days, and that their duration extend beyond the current EU sanctions against Russia. De Wever"s insistence on such extensive coverage has been met with resistance from other European governments, who view the request as excessive.

European diplomats have expressed concerns that agreeing to a "blank check" arrangement would jeopardize their countries" financial stability. Four EU diplomats, speaking to POLITICO, indicated that they cannot accept De Wever’s proposal, as it would leave their nations vulnerable to substantial financial liabilities based on possible future court rulings regarding the frozen assets. This could result in billions of euros in repayments long after the ongoing conflict in Ukraine has concluded.

The backdrop to this negotiation is the European Commission"s impending announcement of a legal framework for the loan scheme, which is critical as Ukraine faces a potential budget shortfall by April 2026. EU leaders are scheduled to convene in mid-December 2025 to discuss this pressing issue, with the outcome of these discussions potentially impacting the financial support available to Ukraine in its ongoing conflict with Russia.

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Background

The frozen Russian assets in question, totaling €140 billion, represent a significant financial resource that the EU is considering leveraging to support Ukraine amid its war efforts. The urgency of this matter is underscored by the upcoming EU summit, where leaders will deliberate on the best course of action to assist Ukraine. The reluctance of EU countries to provide unlimited guarantees reflects broader concerns about fiscal responsibility and the potential long-term implications of such commitments.

Belgium"s request for extensive financial guarantees highlights the complexities involved in international financial agreements, particularly in the context of geopolitical tensions with Russia. The fear of Russian retaliation further complicates the situation, as EU nations weigh the risks of financial exposure against the need to support Ukraine.

What"s Next

If Belgium"s request continues to be met with resistance, the EU may need to explore alternative funding mechanisms. One potential solution could involve issuing additional EU debt to cover Ukraine"s budget shortfall, although this approach is unpopular among many EU governments due to the implications for taxpayer funding. The outcome of the mid-December summit will be crucial in determining how the EU proceeds with its financial support for Ukraine and the management of frozen Russian assets.

As the situation develops, the implications of these negotiations will be closely monitored, particularly in light of the ongoing conflict in Ukraine and the broader geopolitical landscape. For further context on related international developments, see our coverage on recent developments regarding Russia"s military strategy.

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