EU's Ambitious Plan to Leverage Frozen Russian Assets for Ukraine's Future

The European Union is debating a plan to use billions in frozen Russian assets to fund a massive loan for Ukraine's economic and military needs. With risks involved, options include a reparations loan or borrowing on financial markets. A critical summit will soon determine the decision.

European Union leaders are in intense negotiations to finalize a strategy using billions of dollars in frozen Russian assets to support Ukraine's economic and military needs over the next two years. The plan comes at a critical time with a summit imminent.

The initiative aims to leverage Russian Central Bank assets, frozen since President Putin's 2022 invasion of Ukraine, to create a massive loan. However, the proposal faces significant challenges, including the need for substantial political cooperation and potential legal risks, with some member countries wary of retaliation from Russia.

European Council President António Costa is pushing for a consensus, emphasizing the urgency of the situation. Two primary strategies are on the table: a reparations loan or financial market borrowing. The outcome remains uncertain as the EU seeks a united front amid rising tensions.

(With inputs from agencies.)