Key facts
- Ukraine is pushing European allies to seriously discuss using frozen Russian state assets to address its budget deficit.
- Kyiv proposes partial disbursements and broader guarantees to overcome objections, particularly from Belgium.
- Over €210 billion of Russian central bank assets are immobilized in the EU, primarily held by Euroclear in Brussels.
- Belgium has resisted these proposals due to potential legal risks and the possibility of Russian retaliation.
- Ukraine requires an additional €27 billion for defense spending in 2026 and faces a budget deficit exceeding $32 billion this year.
Ukraine is intensifying its efforts to persuade European allies to seriously consider using frozen Russian state assets to help finance its budget deficit and defense needs amid the ongoing war. A senior Ukrainian official indicated a growing readiness among European partners to resume discussions and reach a decision on the matter.
Kyiv faces a significant budget shortfall, requiring an additional €27 billion for defense spending in 2026, and is seeking creative solutions from its allies. The proposal involves accessing some of the approximately €210 billion in Russian central bank assets immobilized in the EU since the start of the war.
However, Belgium, where the bulk of these funds are held by the depository Euroclear, has consistently resisted such proposals due to potential legal risks and the possibility of Russian retaliation. Ukraine's Finance Minister, Serhii Marchenko, stated that discussions are underway with partners about changing legal jurisdictions to shift the responsibility away from Belgium and onto the joint responsibility of the 27 EU members.
Despite Belgium's unchanged position, Ukraine remains hopeful that by proposing partial disbursements and broader guarantees, a path forward can be found. The country's budget deficit is projected to exceed $32 billion this year, with plans to cover it through funds from the EU and other partners.