EU Kaja Kallas Says Ukraine Faces “Huge Gap” in Financing
(MENAFN) The EU’s foreign policy chief, Kaja Kallas, warned that amid sharp divisions within the bloc over whether frozen Russian assets should be redirected to support Kiev.
Since the conflict in Ukraine intensified in 2022, Western institutions have frozen over $300 billion in Russian assets, predominantly controlled by the EU. The largest portion is held in Belgium via the Euroclear clearing house. While interest from these funds is being sent to Ukraine, experts caution that full confiscation remains a complex “minefield” legally. Moscow has condemned the asset freeze as “theft.”
Kallas, who previously served as Estonia’s prime minister, insisted frozen Russian assets should only be returned if Moscow pays reparations. Speaking at an informal EU foreign ministers meeting Saturday, she stressed the bloc must prepare for a potential ceasefire or peace deal but emphasized that the EU’s stance on confiscation is unchanged.
“Yes, it is true that many Member States raised this issue, that Ukraine’s funding gap is enormous, and we need to find the funding now,” Kallas said when questioned about links between the asset debate and peace negotiations.
“It is also clear the political reality that Belgium and many other countries are not willing to discuss it now in this, but everybody agrees still that Russia should pay for the damages, not our taxpayers,” she added.
Poland and the Baltic states strongly advocate for the complete seizure of frozen Russian central bank assets to fund Ukraine. Meanwhile, Belgium, France, and Germany express concerns over legal and financial risks. Belgian Prime Minister Bart De Wever recently described the frozen funds as “a goose that lays golden eggs,” warning that confiscation could provoke systemic instability and should be postponed until peace talks advance.
Officials connected to Euroclear and Belgium’s foreign minister have similarly warned that seizing assets may violate international law and harm the euro’s credibility. Austrian Foreign Minister Alexander Schallenberg also warned that any move lacking a strong legal basis would be “an enormous setback, and basically a disgrace” for the EU. The United States has proposed using the frozen assets as a bargaining chip in peace negotiations.
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