Europe is faced with one of its most critical choices since the Russian attack on Ukraine. There are about €210 billion of Russian sovereign assets frozen across the entire European Union, of which €183 billion are held by Euroclear, headquartered in Brussels. This choice aims to assess Europe’s financial solidity over the next few years. The Europeans were very divided, confused, and terrified of the Russian response when they met at the Brussels session on 18 December. Hence, they delayed their much-hyped plan to tap the Russian frozen assets.

The strategic appeal

Ukraine faces a significant funding gap, and this year it needs $51.5 billion to finance its budget deficit, which accounts for 25 per cent of its 2025 budget. Several leaders of European countries, however, believe that tapping Russian assets and profits can help alleviate the burden on European taxpayers, proving that aggression carries economic costs.

Belgian Foreign Minister Maxime Prévot described his nation’s view that the loan for reparations is “risky and unprecedented,” and that it favors more traditional market borrowing. However, it has also been argued that this move would strengthen a deterrence policy in Europe, signaling that violating international law could result in the depletion of a state’s national wealth.

Belgium’s central dilemma

Belgium received €1.7 billion in these corporate taxes from Euroclear’s earnings on frozen Russian assets in 2024. However, under the EU’s new system, these earnings would go directly to Ukraine, bypassing Belgium altogether. Prime Minister Bart De Wever said, “A whole lot of these funds are immobilised in Brussels, at Euroclear,” and added that “it is not so easy,........

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