Belgium Blocks €140bn 'Reparation Loan' to Ukraine, Citing Legal Risk and Threat to Peace Talks

Belgium has refused to back an EU proposal to lend €140bn of frozen Russian central bank assets to Ukraine, arguing the measure could undermine prospects for a negotiated peace and expose Belgian financial infrastructure to legal and systemic risk.

The scheme — promoted as a “reparation loan” and worth roughly £122bn — depends on assets held by Euroclear, the clearing house headquartered in Brussels, making Belgian agreement essential. Prime Minister Bart De Wever says Belgium could face litigation from Russia over Euroclear’s role, which might in turn trigger broader financial instability.

Belgium demands ironclad guarantees

Mr De Wever, a Flemish nationalist, set out his objections in a letter to European Commission president Ursula von der Leyen. He warned that moving hastily on the proposal could have the unintended consequence of jeopardising an eventual peace deal. “Hastily moving forward on the proposed reparations loan scheme would have, as collateral damage, that we as EU are effectively preventing reaching an eventual peace deal,” he wrote.

He described the plan as “fundamentally wrong”, noting that historically a belligerent country’s immobilised assets are not normally mobilised until after hostilities end and can then be applied to reparations. He also reiterated concerns about potential Russian litigation — a threat Moscow has repeatedly signalled.

How the loan would work

Under the EU proposal, frozen Russian central bank assets held across Europe would be lent to Kyiv for defence spending and budget support. Ukraine would begin repaying the loan only once it receives war reparations from Russia. Supporters say the measure would relieve financial pressure on European governments, which have been Ukraine’s main donors since the full-scale invasion in February 2022.

Responses and next steps

William Browder, a prominent campaigner against corruption in Russia, said he expects a deal could be reached to release the funds to avoid committing European troops. He called Belgium’s caution “very justified” and suggested EU states should agree to share any legal liability equally, while adding his view that Russian litigation is unlikely to succeed.

The European Commission plans to publish draft legal proposals to address Belgium’s concerns imminently. Leaders including France’s Emmanuel Macron and Germany’s Friedrich Merz view the frozen assets as a rare source of leverage in diplomatic efforts involving the US and Russia aimed at ending the war.

European leaders endorsed the idea at a recent summit but could not secure Belgium’s support, creating a setback ahead of sensitive negotiations. Brussels hopes to resolve the issue at the next EU leaders’ summit scheduled for Dec 18–19.

Aside from the funds immobilised at Euroclear, an estimated €25bn of Russian assets are frozen in other EU banks, primarily in France and Luxembourg. Belgium has also argued that other jurisdictions holding frozen Russian assets — including the UK, Canada, Japan and the US — should be part of any wider scheme, reflecting concerns about shared liability and international coordination.

Domestically, Mr De Wever’s stance comes as his coalition seeks to stabilise public finances after protracted budget negotiations and strikes over proposed spending cuts and pension reforms.