According to Politico, European countries are working intensively on a back-up solution to prevent Ukraine from finding itself without funds at the beginning of next year. It is still unclear whether member states will be able to reach a consensus in time to use frozen Russian state assets as a source of long-term funding. The proposal to set up a reparation loan of up to 140 billion based on these resources is facing resistance, particularly from Belgium, the state that manages the Russian assets.
As Politico reports, as peace talks progress and Ukraine's treasury becomes increasingly strained, pressure for a quick decision is mounting. Some EU officials warn that if Europe does not react in time, other actors may step in. There is therefore an expectation within the EU that European Commission chief Ursula von der Leyen will soon task her team with drafting a concrete legal proposal that would open the way for reparations funding. According to sources quoted by Politico, Russia would only get the property back if it pays for the damage caused by the aggression.
But the Prime Minister of Belgium Bart De Wever continues to express concern about the legal consequences and the risk of Russian retaliation. And it is this uncertainty that is forcing EU diplomats to look for a Plan B - a more temporary structure, but one that can be implemented quickly. There is growing support for the option of a temporary „bridging“ loan, financed directly by common EU debt.
This could keep Ukraine economically alive during the first months of 2026, while giving member states time to fine-tune the reparations fund to suit Belgium. According to two diplomats, Ukraine would later repay this transitional loan from the proceeds of the long-term fund.
According to Politico, almost all of the countries concerned are pushing the Commission to act quickly. France, Germany, the Netherlands and the Baltic states consider Kiev's funding crucial. At the same time, Emmanuel Macron assured that the allies will present a solution „in the coming days“ so that Ukraine can be assured of forthcoming support.
Obstacles remain, however. Any common European debt must be approved by all 27 EU members, and Hungary has long opposed further funding for Ukrainian defence. Diplomats hope, however, that if the loan is presented primarily as a reconstruction tool rather than as war funding, the chances of a deal will increase. Politico also notes that Europe wants to maintain control over the use of frozen Russian assets and not let the United States exclusively decide their fate - especially in the context of new U.S. peace proposals.
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