The Belgian Prime Minister Bart De Wever (Flemish nationalist has firmly rejected a proposal by German chancellor Friedrich Merz to use frozen Russian central-bank assets, a large portion of which are held at Euroclear in Brussels, to finance a multi-billion-euro interest-free loan for Ukraine. Speaking in the margins of the UN General Assembly in New York, Mr De Wever told journalists that “Taking Putin’s money and leaving the risks with us. That’s not going to happen, let me be very clear about that.”
De Wever firmly rejects German Chancellor’s idea of using Russia’s frozen assets to fund a loan for Ukraine
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In a piece published in Friday’s edition of the ‘Financial Times’, Chancellor Merz suggests using frozen Russian assets to provide Ukraine with an interest-free loan of around 140 billion euro. The Ukrainians wouldn’t have to repay the loan until Russia had compensated them for war damage.
A large portion of Russia’s frozen assets, around 170 billion euro, are held at Euroclear in Brussels. As things currently stand, only the interest accrued on the frozen assets is being used to support Ukraine. Belgium has always rejected the idea of using the actual assets to help Ukraine, as it fears arbitration claims and that it might one day be forced to pay Russia back.
Furthermore, loaning the frozen Russian funds to Ukraine would have a serious impact on Belgium’s public finances. The Federal Government is counting on the 25% corporation tax that is levied on the Frozen Russian assets held here to help finance the increase in defence spending to 2% GDP. If the European Commission were to back Chancellor Merz’s proposal, Belgium’s Federal Government would be forced to look elsewhere for revenue.
“It will never happen”
Speaking in the margins of the UN General Assembly, Mr De Wever said that Chancellor Merz’s proposal "will never happen". The Belgian Prime Minister argues that seizing central bank assets of a third country would set a dangerous precedent
"If countries see that central bank money can disappear when European politicians see fit, they might decide to withdraw their reserves from the eurozone."
De Wever added Chancellor Merz's public statement regarding this is regrettable. "I’ve told everyone that I am happy to discuss this. But let's talk and come up with something, rather than sharing an opinion on it every day. I find it quite frustrating."