Full Breakdown
EU Says Frozen Russian Assets Not Current Priority Amid Ukraine Funding Push
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Commission’s Current Focus
The European Commission’s chief spokesperson, Paula Pinho, said that the immobilised assets of the Russian Central Bank are not the “primary focus” for the EU at the moment. The Commission is concentrating on two fronts: continuing the gradual disbursement of the €90 billion loan that finances financial and military assistance for Ukraine, and working with the Ukrainian government and the International Monetary Fund (IMF) to determine the exact size of Kyiv’s budget shortfall.
Ukraine’s Growing Budget Shortfall
Ukrainian President Volodymyr Zelenskyy recently asked allies to cover a €23 billion (approximately $27 billion) deficit in the Ministry of Defence and has highlighted an additional €32.6 billion of uncovered budget needs for the coming year. EU and IMF officials have been scrambling to assess the source and magnitude of these figures, underscoring the scale of the financial challenge facing a country under invasion without full U.S. contributions.
Member States and Parliament Call for Asset Use
Sweden, the Netherlands, Poland, Spain and the Baltic states have urged the Commission to devise new legal mechanisms to tap the frozen Russian assets, estimated at €210 billion. Ukraine has endorsed the idea of creating an EU-owned custodian to hold the assets currently stored at Euroclear in Brussels. A cross-party group of 122 members of the European Parliament has also sent a letter urging the Commission to “reopen the political discussion” and advance the custodian proposal, seeking to overcome objections from Belgium.
Legal and Political Obstacles
Belgium has maintained that its objections have not “magically disappeared,” and Euroclear is confronting a legal challenge from the Russian Central Bank. A multi-layered legal proposal the Commission advanced last year collapsed in December after fierce resistance from Belgium and reservations from Euroclear.
Outlook and Possible Re-engagement
Economy Commissioner Valdis Dombrovskis indicated that the Commission’s services are ready to “re-engage” on the Russian assets and help find a way forward, but he stopped short of committing to new legislation, noting that any move will depend on guarantees that an agreement can be reached among member states. The assets therefore remain a potential tool, pending resolution of the political and legal hurdles.