Belgium pushes for financial guarantees to support Ukraine’s reparations loan
“We are advancing our work to meet Ukraine’s financial needs,” Commission President Ursula von der Leyen posted on X on Monday. “We have made good progress, and we plan to table our legal proposals this week,” reports 24brussels.
The proposed reparations loan has sparked significant debate within the Belgian government, as it aims to utilize the cash value of frozen Russian state assets located in Belgium to finance Ukraine.
In light of potential Russian retaliation, Belgian Prime Minister Bart De Wever demands that EU governments provide Belgium with financial guarantees exceeding €140 billion, which should be ready for disbursement within days. He is also seeking assurances that the duration of these guarantees will surpass the period of the EU’s sanctions against Russia.
While European governments show some willingness to back a pre-agreed amount, they express hesitation towards what they characterize as a “blank check.” Four EU diplomats indicated that they would be unable to accommodate De Wever’s conditions, as this could jeopardize their national financial stability subject to the outcomes of court decisions, potentially leading to substantial repayments long after the conflict in Ukraine concludes.
“If [the guarantees] are infinite and without limits, then what are we getting ourselves into?” questioned an EU diplomat, who requested anonymity to speak candidly. The complexity surrounding the extent of the national guarantees is becoming a focal point in ongoing negotiations.
Another EU diplomat acknowledged the political difficulty many member states face in committing to such unrestricted guarantees but noted the improbability of these safety nets being utilized, asserting that the EU’s overall scheme remains legally sound.
The discourse surrounding Belgium’s approach is emblematic of the broader challenges facing EU member states as they navigate their financial obligations amidst geopolitical tensions. The issue remains under active consideration while the search for a balanced solution continues.
