Germany Proposes Ukraine Loan Backed by Frozen Russian Assets

Germany has proposed a new loan to Ukraine backed by frozen Russian sovereign assets, Politico reported. The mechanism would finance a €100 billion support package earmarked for Kyiv in the EU's next multiannual budget.

The plan would service the debt using windfall proceeds or principal from the immobilized reserves, easing pressure on national budgets. Berlin's initiative reflects urgency to secure durable financing without overstretching EU fiscal capacity.

Sweden, Poland, the Netherlands and Spain support mobilizing the blocked holdings, estimated at roughly €200 billion across the bloc. They argue the assets should rebuild the country they were frozen to penalize.

Belgium opposes the move. Most reserves are held at Euroclear in Brussels, and Belgian officials warn that pledging the principal could expose the depository to legal challenges and threaten financial stability.

The dispute highlights a wider EU split over how far to push asset-confiscation tools without breaching international law or inviting retaliation against European financial infrastructure. Talks will intensify as the new budget cycle nears.