The European Union may be forced to raise tens of billions of euros in joint debt if Belgium does not agree to unblock the mechanism of the so-called "reparation loan" to Ukraine.
Points of attention
- The European Union is facing the need to find a new financing mechanism for Ukraine following Belgium's reluctance to unblock the 'reparation loan'.
- The possibility of joint debt issuance by EU countries is being considered if Belgium does not agree to the proposed financing method, amid concerns about funding for Ukraine by the end of the first quarter of 2026.
- While some EU member states are inclined towards joint debt for Ukraine's financing, others view utilizing frozen Russian assets as a viable solution.
EU seeks new financing mechanism for Ukraine
According to the publication's sources, without new financial assistance, Ukraine may face significant difficulties as early as the end of the first quarter of 2026.
Belgium received the European Commission's legal proposal to use Russian assets only on the morning of October 23, just before the EU summit. Most of these funds are held in the Belgian depository Euroclear, so the country's government is being cautious about possible financial risks.
As Politico notes, in such circumstances, Prime Minister Bart de Wever did not rush into making a decision.
After Belgium did not lift its reservation, several EU leaders began discussing the possibility of issuing joint debt to finance Ukraine. However, the publication's sources emphasize that this issue does not yet have broad support, given the high levels of debt of most EU countries.
Most member states see using frozen Russian assets as the best option. According to two diplomats, the idea of joint debt was presented more as a "horror story" to push Belgium into making a decision.
"What's the point of discussing alternative solutions? [The reparations loan] is the only thing we have. And we have to be honest about it," one European diplomat said.
In addition to Plan B with joint debt, the EU is also considering a third scenario — the termination of financial support for Ukraine, but only Hungary supports it.
The final decision on the financing mechanism must be made by EU leaders by December 18.
Despite the postponement, EU leaders confirmed that they will continue to support Ukraine for as long as necessary, providing it with the necessary resources to defend against Russian aggression.
