Izvestia: EU split grows over proposal to fund Ukrainian ‘reparations loan’ with frozen Russian assets
TASS, 10/2/25
The division within the European Union is intensifying over a new initiative to establish a reparations loan for Ukraine backed by Russian holdings. German Chancellor Friedrich Merz has urged Brussels to abandon excessive bureaucracy, while French President Emmanuel Macron and Belgian Prime Minister Bart De Wever warn of breaches of international law. Yet, only days earlier, France and Germany, within the framework of the Weimar Triangle, had voiced support for the idea of employing Russian assets. Attempts to seize Russian property will trigger a painful mirror response, the Russian Foreign Ministry told Izvestia.
“Whichever option Brussels ultimately chooses, manipulating frozen sovereign assets without Russia’s consent constitutes a gross violation not only of international law, but also of contractual law. Russia has not authorized any such operations. Actions that involve altering the legal status of Russian assets will no longer mean a freeze, but rather the unauthorized management of foreign property – in other words, essentially theft,” the Russian Foreign Ministry told Izvestia.
“The overwhelming majority of experts argue that the risks of outright confiscation for the dollar and euro systems are far greater than the potential benefits from employing these funds – primarily because of the precedent it would set and the erosion of trust in the financial jurisdiction of Western countries,” Senior Research Fellow at the Institute for International Studies of MGIMO, Russian Ministry of Foreign Affairs, Egor Sergeyev told Izvestia.
“In the short term, no consensus on this matter can be reached, if only because none exists even within the European Union. And in the United States, even under the Biden administration, it has been concluded that from a legal standpoint, this scheme is extremely precarious,” a leading expert at the Russian Institute for Strategic Studies Pavel Zakharov told the newspaper.
According to Vladimir Vasiliev, Chief Research Fellow at the Institute for the US and Canadian Studies, Washington is unlikely to risk its reputation over $5 bln, but may well push Europe in that direction – in which case European capital will begin to flow into the United States.
“The initiators and participants of expropriation measures are guaranteed to face consequences. Moreover, in accordance with the principle of reciprocity, attempts to seize Russian property will provoke a painful retaliatory response. Russia has at its disposal a sufficient arsenal of countermeasures and the ability to deliver an appropriate political and economic answer,” the Russian Foreign Ministry told Izvestia.
First, the measures could be legal in nature, since what is at stake is a violation of international law. Second, the response could be purely economic. Moscow has already developed a system of specific steps, such as temporary management of the property of companies from unfriendly states, or the transfer of such assets to state ownership or to the Central Bank as compensation for any seizures, the newspaper writes.
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Russia Drafts Plan to Seize Assets If EU Acts on Funds (Excerpt)
Bloomberg, 10/2/25
Russia may nationalize and swiftly sell off foreign-owned assets under a new privatization mechanism in retaliation for any European moves to seize Russian holdings abroad, according to a person close to the government.
President Vladimir Putin on Tuesday signed an order allowing for fast-track sales of state-owned assets under a special procedure.
The decree is intended to speed up the sale of various companies, both Russian and foreign, the person familiar with the matter said, asking not to be identified because the information isn’t public. Should the European Union begin seizing Russian assets, Moscow may respond with symmetrical measures, the person said.
Hundreds of western companies working in sectors from banking to consumer goods still operate in Russia, including UniCredit SpA, Raiffeisen Bank International AG, PepsiCo Inc, and Mondelez International Inc.
Putin acted as EU leaders meeting in Denmark build momentum for a plan to provide Ukraine with €140 billion ($164 billion) in loans from immobilized Russian central bank assets, ahead of a formal summit at the end of this month….
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Belgium Pours Cold Water on EU Plan to Use Russian Frozen Assets (Excerpt)
Bloomberg, 10/2/25
The European Union’s bid to unlock funding for Ukraine from frozen Russian central bank assets faced resistance as Belgium raised legal questions about the plan to raise financing from up to €185 billion ($217 billion) held on its territory.
Belgian Prime Minister Bart de Wever called the EU proposal to tap interest from the Russian assets a “big gamble” that required ironclad risk-sharing among EU member states. He signaled that the process would be time consuming, suggesting the bloc seek alternative financing for Kyiv.
“Every country will have to guarantee proportionally in the case that this goes wrong,” De Wever told reporters Thursday on the margins of a European Political Community summit in Copenhagen. The EU asset plan entails “huge amounts of money,” requiring guarantees for “a very long time,” he said.
EU leaders who gathered for a meeting Wednesday in the Danish capital offered a more upbeat assessment, saying that the bid to raise billions for war-battered Ukraine is gathering momentum and concerns would be allayed. European Commission President Ursula von der Leyen assured that the risks tied to the plan would land on “broader shoulders.”…
