BRUSSELS — The European Commission on Wednesday unveiled a €90 billion loan to Ukraine aimed at saving it from financial collapse as it continues to battle Russia while aid from the U.S. dries up. About one-third of the cash will be used for normal budget expenditures and the rest will go to defense — although countries still need to formally agree to what extent Ukraine can use the money to buy weapons from outside the EU. A Commission proposal gives EU defense firms preferential treatment but allows Ukraine to buy foreign weapons if they aren’t immediately available in Europe. While the loan is interest-free for Ukraine, it is forecast to cost EU taxpayers between €3 billion and €4 billion a year in borrowing costs from 2028. The EU had to resort to the loan after an earlier effort to use sanctioned Russian frozen assets ran into opposition from Belgium. The race is now on for EU lawmakers to agree on a final legal text that’ll pave the way for disbursements in April, when Ukraine’s war chest runs out. Meetings between EU treasury and defense officials are already planned for Friday. The European Parliament could fast-track the loan as early as next week. The financing package is also crucial for unlocking additional loans to Ukraine from the International Monetary Fund. The Washington-based Fund wants to ensure Kyiv’s finances aren’t overstretched, as the war enters its fifth year next month. The €90 billion will be paid out over the next two years, as Moscow shows no sign of slowing down its offensive on Ukraine despite U.S.-led efforts to agree on a ceasefire. “Russia shows no sign of abating, no sign of remorse, no sign of seeking peace,” Commission President Ursula von der Leyen told reporters after presenting the proposal. “We all want peace for Ukraine, and for that, Ukraine must be in a position of strength.” When EU leaders agreed on the loan, Ukrainian President Volodymyr Zelenskyy called the deal an “unprecedented decision, and it will also have an impact on the peace negotiations.” Adding to the pressure on the EU, the U.S. under President Donald Trump has halted new military and financial aid to Ukraine, leaving it up to Europe to ensure Kyiv can continue fighting. Once the legal text is agreed, the EU will raise joint debt to finance the initiative, although the governments in the Czech Republic, Hungary and Slovakia said they will not participate in the funding drive.  The conditions on military spending are splitting EU countries. Paris is demanding strict rules to prevent money from flowing to U.S. weapons manufacturers, while Germany and other Northern European countries want to give Ukraine greater flexibility on how to spend the cash, pointing out that some key systems needed by Ukraine aren’t manufactured in Europe. MEETING HALFWAY The Commission has put forward a compromise proposal — seen by POLITICO. It gives preferential treatment to defense companies based in the EU, Ukraine and neighboring countries, including Norway, Iceland and Liechtenstein, but doesn’t rule out purchases from abroad. To keep the Northern European capitals happy, the Commission’s proposal allows Ukraine to buy specialized weapons produced outside the EU if they are vital for Kyiv’s defense against Russian forces. These include the U.S. Patriot long-range missile and air defense systems. The rules could be bent further in cases “where there is an urgent need for a given defense product” that can’t be delivered quickly from within Europe. Weapons aren’t considered European if more than 35 percent of their parts come from outside the continent, according to the draft. That’s in line with previous EU defense-financing initiatives, such as the €150 billion SAFE loans-for-weapons program. Two other legal texts are included in the legislative package. One proposes using the upper borrowing limit in the current budget to guarantee the loan. The other is designed to tweak the Ukraine Facility, a 2023 initiative that governs the bloc’s long-term financial support to Kyiv. The Commission will also create a new money pot to cover the borrowing costs before the new EU budget enters into force in 2028. RUSSIAN COLLATERAL Ukraine only has to repay the €90 billion loan if it receives post-war reparations from Russia — an unlikely scenario. If this doesn’t happen, the EU has left the door open to tapping frozen Russian state assets across the bloc to pay itself back. Belgium’s steadfast opposition to leveraging the frozen assets, most of which are based in the Brussels-based financial depository Euroclear, promises to make that negotiation difficult. However, the Commission can indefinitely roll over its debt by issuing eurobonds until it finds the necessary means to pay off the loan. The goal is to ensure Ukraine isn’t left holding the bill. “The Union reserves its right to use the cash balances from immobilized Russian assets held in the EU to repay the Ukraine Support Loan,” Economy Commissioner Valdis Dombrovskis said alongside von der Leyen. “Supporting Ukraine is a litmus test for Europe. The outcome of Russia’s brutal war of aggression against Ukraine will determine Europe’s future.” Jacopo Barigazzi contributed to this report from Brussels.

Mujtaba Rahman is the head of Eurasia Group’s Europe practice. He posts at @Mij_Europe. 2026 is here, and Europe is under siege. External pressure from Russia is mounting in Ukraine, China is undermining the EU’s industrial base, and the U.S. — now effectively threatening to annex the territory of a NATO ally — is undermining the EU’s multilateral rule book, which appears increasingly outdated in a far more transactional and less cooperative world. And none of this shows signs of slowing down. In fact, in the year ahead, the steady erosion of the norms Europe has come to rely on will only be compounded by the bloc’s weak leadership — especially in the so-called “E3” nations of Germany, France and the U.K. Looking forward, the greatest existential risks for Europe will flow from the transatlantic relationship. For the bloc’s leaders, keeping the U.S. invested in the war in Ukraine was the key goal for 2025. And the best possible outcome for 2026 will be a continuation of the ad-hoc diplomacy and transactionalism that has defined the last 12 months. However, if new threats emerge in this relationship — especially regarding Greenland — this balancing act may be impossible. The year also starts with no sign of any concessions from Russia when it comes to its ceasefire demands, or any willingness to accept the terms of the 20-point U.S.-EU-Ukraine plan. This is because Russian President Vladimir Putin is calculating that Ukraine’s military situation will further deteriorate, forcing Ukrainian President Volodymyr Zelenskyy to capitulate to territorial demands. I believe Putin is wrong — that backed by Europe, Zelenskyy will continue to resist U.S. pressure on territorial concessions, and instead, increasingly target Russian energy production and exports in addition to resisting along the frontline. Of course, this means Russian aerial attacks against Ukrainian cities and energy infrastructure will also increase in kind. Nonetheless, Europe’s growing military spending, purchase of U.S. weapons, financing for Kyiv and sanctions against Russia — which also target sources of energy revenue — could help maintain last year’s status quo. But this is perhaps the best case scenario. Activists protest outside Downing street against the recent policies of Donald Trump. | Guy Smallman/Getty Images Meanwhile, European leaders will be forced to publicly ignore Washington’s support for far-right parties, which was clearly spelled out in the new U.S. national security strategy, while privately doing all they can to counter any antiestablishment backlash at the polls. Specifically, the upcoming election in Hungary will be a bellwether for whether the MAGA movement can tip the balance for its ideological affiliates in Europe, as populist, euroskeptic Prime Minister Viktor Orbán is currently poised to lose for the first time in 15 years. Orbán, for his part, has been frantically campaigning to boost voter support, signaling that he and his inner circle actually view defeat as a possibility. His charismatic rival Péter Magyar, who shares his conservative-nationalist political origins but lacks any taint of corruption poses a real challenge, as does the country’s stagnating economy and rising prices. While traditional electoral strategies — financial giveaways, smear campaigns and war fearmongering — have so far proven ineffective for Orbán, a military spillover from Ukraine that directly affects Hungary could reignite voter fears and shift the dynamic. To top it all off, these challenges will be compounded by the E3’s weakness. The hollowing out of Europe’s political center has already been a decade in the making. But France, Germany and the U.K. each entered 2026 with weak, unpopular governments besieged by the populist right and left, as well as a U.S. administration rooting for their collapse. While none face scheduled general elections, all three risk paralysis at best and destabilization at worst. And at least one leader — namely, Britain’s Keir Starmer — could fall because of an internal party revolt. The year’s pivotal event in the U.K. will be the midterm elections in May. As it stands, the Labour Party faces the humiliation of coming third in the Welsh parliament, failing to oust the Scottish National Party in the Scottish parliament and losing seats to both the Greens and ReformUK in English local elections. Labour MPs already expect a formal challenge to Starmer as party leader, and his chances of surviving seem slight. France, meanwhile, entered 2026 without a budget for the second consecutive year. The good news for President Emmanuel Macron is that his Prime Minister Sébastien Lecornu’s minority government will probably achieve a budget deal targeting a modest deficit reduction by late February or March. And with the presidential election only 16 months away and local elections due to be held in March, the opposition’s appetite for a snap parliamentary election has abated. However, this is the best he can hope for, as a splintered National Assembly will sustain a mood of slow-motion crisis until the 2027 race. Finally, while Germany’s economy looks like it will slightly recover this year, it still won’t overcome its structural malaise. Largely consumed by ideological divisions, Chancellor Friedrich Merz’s government will struggle to implement far-reaching reforms. And with the five upcoming state elections expected to see increased vote shares for the far-right Alternative for Germany party, pressure on the government in Berlin will only mount A historic truth — one often forgotten in the quiet times — will reassert itself in 2026: that liberty, stability, prosperity and peace in Europe are always brittle. The holiday from history, provided by Pax Americana and exceptional post-World War II cooperation and integration, has officially come to an end. Moving forward, Europe’s relevance in the new global order will be defined by its response to Russia’s increased hybrid aggression, its influence on diplomacy regarding the Ukraine war and its ability to improve competitiveness, all while managing an increasingly ascendant far right and addressing the existential threats to its economy and security posed by Russia, China and the U.S. This is what will decide whether Europe can survive.

ROME — Italian Prime Minister Giorgia Meloni on Friday called on Europe to appoint a special envoy to talk to Russia, as efforts continue to end the Kremlin’s war in Ukraine. Meloni said that she agreed with French President Emmanuel Macron, who last month called for new dialogue with the Kremlin. Russian President Vladimir Putin “expressed readiness to engage in dialogue” with Macron, Moscow said in response. “I believe the time has come for Europe to also speak with Russia,” Meloni told a press conference in Rome on Friday. “If Europe speaks to only one of the two sides on the field, I fear that the contribution it can make will be limited.” Meloni warned that Europe needs a coordinated approach or “risks doing Putin a favor.” Since the beginning of negotiations over a potential ceasefire in Ukraine, “many voices have been speaking out, and that’s why I’ve always been in favor of appointing a European special envoy on the Ukrainian issue,” Meloni said. Peace talks aimed at ending the all-out conflict, which Russia launched in February 2022, have accelerated with U.S. President Donald Trump back in the White House, but Moscow has not indicated that it is willing to make concessions. The U.S. in November proposed that Russia be readmitted to the Group of Seven leading nations. But Meloni said it was “absolutely premature” to talk about welcoming Russia back to the G7 fold. Meloni also emphasized that Italy would not join France and the U.K. in sending troops to Ukraine to guarantee a potential peace deal, because it was “not necessary” if Ukraine signed a collective defense agreement with Western allies modeled on NATO’s Article 5 collective-defense provision. She suggested that a small contingent of foreign troops would not be a serious deterrent against a much larger Russian force. Reacting to Trump’s recent aggressive rhetoric toward Greenland, Meloni said that she “would not approve” of a U.S. military takeover of the vast Arctic island. “I don’t believe that the USA will carry out military action on Greenland, which I would not approve of and would not do anyone any good,” she told reporters. Meloni said she believed the Trump administration was using “very assertive methods” to draw attention to the strategic importance of Greenland for U.S. interests and security. “It’s an area where many foreign actors are carrying out activity and I think that the message of the USA is that they will not accept excessive interference by foreign actors,” she said.   Meloni also countered Trump’s remarks Thursday that he does not need international law, stressing that “international law must be defended.” But she added that it was normal to disagree with allies, “as national interests are not perfectly aligned.” “When I don’t agree with Trump, I say so — I say it to him.”

Sen. Lindsey Graham said Wednesday after meeting with President Donald Trump that the Senate could vote as soon as next week to impose new sanctions aimed at pressuring Russia to end its war with Ukraine. “After a very productive meeting today with President Trump on a variety of issues, he greenlit the bipartisan Russia sanctions bill that I have been working on for months with Senator [Richard] Blumenthal and many others,” Graham (R-S.C.) said in a statement, referring to the Connecticut Democrat who coauthored the long-stalled legislation. Spokespeople for the White House didn’t immediately respond to a request for comment. Graham said a Senate vote would take place “hopefully as early as next week.” Graham and Senate Republican leaders have been working with the White House for months to try to reach an agreement on a final version of the legislation — and this isn’t the first time Graham has declared that his bill could soon move, for it to only stall out again. The legislation would place secondary sanctions on countries such as China and India that buy oil and gas from Russia in a bid to cut off the cash flow for President Vladimir Putin’s war machine. “Ukraine is making concessions for peace and Putin is all talk, continuing to kill the innocent,” Graham said, saying the legislation would be “well-timed.” A spokesperson for Graham didn’t immediately respond to a question about whether changes will be incorporated at Trump’s request. The president has previously requested absolute flexibility to impose and retract any sanctions at will.

Jamie Dettmer is opinion editor and a foreign affairs columnist at POLITICO Europe. Russia’s war on Ukraine seems likely to end next year — and on terms highly unfavorable for Kyiv. Why the prediction? Because of the EU’s failure last week to agree to use Russia’s money — €210 billion in frozen assets — to keep Ukraine solvent and able to finance its war effort. The felling of the “reparations loan” proposal, which would have recycled Russian assets that are mostly frozen in a clearing bank in Belgium, deprives Ukraine of guaranteed funding for the next two years. It was Belgium’s legal anxieties over the loan, along with French President Emmanuel Macron’s and Italian Prime Minister Giorgia Meloni’s reluctance to join German Chancellor Friedrich Merz in championing the proposal, that doomed it. And all that, despite weeks of wrangling and overblown expectations by the plan’s advocates, including European Commission President Ursula von der Leyen. Fortunately, the EU will still provide a sizable funding package for Ukraine, after agreeing to jointly borrow  €90 billion from capital markets secured against the EU’s budget, and lend it on a no-interest basis. But while this will prevent the country from running out of money early next year, the package is meant to be spread out over two years, and that won’t be sufficient to keep Ukraine in the fight. According to projections by the International Monetary Fund, due to the reduction in U.S. financial support, Ukraine’s budgetary shortfall over the next two years will be closer to $160 billion. Simply put, Ukraine will need much more from Europe — and that’s going to be increasingly difficult for the bloc to come up with. Still, many European leaders were rather optimistic once the funding deal was struck last week. Finnish President Alexander Stubb noted on Sunday that the agreed package would still be linked to the immobilized Russian assets, as the scheme envisions that Kyiv will use them to repay the loan once the war ends. “The immobilized Russian assets will stay immobilized … and the union reserves its right to make use of the immobilized assets to repay this loan,” he posted on X. Plus, the thinking goes, a subsequent loan could be added on and indirectly linked to the Russian assets. And maybe so. But this could also be construed as counting one’s chickens before they’re hatched, as everything depends on what kind of deal is struck to end the war. In the meantime, securing another loan won’t be so simple once Ukraine’s coffers empty again. Three countries — Hungary, Slovakia and the Czech Republic — already opted out of last week’s joint-borrowing scheme. It isn’t a stretch to imagine others will join them either, balking at the very notion of yet another multi-billion-euro package in 2027, which is an important election year for both France and Germany. Also, Trump will still be in the White House — so, no point in looking to Washington for the additional cash. Angelos Tzortzinis/AFP via Getty Images And yet, Belgian Prime Minister Bart De Wever still described last week’s deal, reached after almost 17 hours of negotiations, as a “victory for Ukraine, a victory for financial stability … and a victory for the EU.” However, that’s not how Russian President Vladimir Putin will see it. As Ukrainian President Volodymyr Zelenskyy had noted while seeking to persuade European leaders to back the reparations loan: “If Putin knows, that we can stay resilient for at least a few more years, then his reason to drag out this war becomes much weaker.” But that’s not what happened. And after last Friday’s debacle highlighted the division among Europe’s leaders, surely that’s not the lesson Putin will be taking home. Rather, it will only have confirmed that time is on his side. That if he waits just a bit longer, the 28-point plan that his aides crafted with Trump’s obliging Special Envoy Steve Witkoff can be revived, leaving Ukraine and Europe to flounder — a dream outcome for the Kremlin. Putin can also read opinion polls, and see European voters’ growing impatience with the war in some of the continent’s biggest economies. For example, published last week, a POLITICO Poll of 10,000 found respondents in Germany and France even more reluctant to keep financing Ukraine than those in the U.S. In Germany, 45 percent said they would support cutting financial aid to Ukraine, while just 20 percent said they wanted to increase financial assistance. In France, 37 percent wanted to give less, while only 24 percent preferred giving more. In the run-up to last week’s European Council meeting, Estonian Prime Minister Kristen Michal had told POLITICO that European leaders were being handed an opportunity to rebut Trump’s claim that they’re weak. That by inking a deal to unlock hundreds of billions in frozen Russian assets, they would also be answering the U.S. president’s branding of Europe as a “decaying group of nations.” That, they failed to do.

Listen on * Spotify * Apple Music * Amazon Music Donald Trumps Rückkehr ins Weiße Haus, Putins Vormarsch in der Ukraine und eine transatlantische Statik, die „endgültig aus den Fugen“ geraten ist: Das Jahr 2025 war sicherheitspolitisch ein Jahr der Zerreißproben. In dieser Sonderfolge zieht Gordon Repinski gemeinsam mit Claudia Major, Sicherheitsexpertin und Senior Vice President, Transatlantic Security beim German Marshall Fund, Bilanz. Major analysiert, warum Europa momentan keine glaubwürdige „Siegtheorie“ für die Ukraine hat und weshalb die Kapitulation Kiews zwar „gerade noch abgewendet“ wurde, die Gefahr für 2026 aber keineswegs gebannt ist. Es geht um die Wirksamkeit des 90-Milliarden-Kredits und die bittere Erkenntnis, dass der Westen derzeit nicht genug tut, um Putins Kalkül zu verändern. Major erklärt, ob und wie sich der Kontinent im Ernstfall auch ohne die USA verteidigen könnte, warum „Sicherheitsgarantien“ oft missverstanden werden und welche Rolle kleine Formate wie die „E3“ oder „E5“ im kommenden Jahr spielen müssen. Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. Jetzt kostenlos abonnieren. Mehr von Host und POLITICO Executive Editor Gordon Repinski: Instagram: @gordon.repinski | X: @GordonRepinski. Legal Notice (Belgium) POLITICO SRL Forme sociale: Société à Responsabilité Limitée Siège social: Rue De La Loi 62, 1040 Bruxelles Numéro d’entreprise: 0526.900.436 RPM Bruxelles info@politico.eu www.politico.eu

BRUSSELS — Diplomats are working on a long-shot 11th-hour compromise to salvage a deal on sending vital financial aid to Ukraine at Thursday’s high-stakes EU leaders’ summit. On Wednesday evening Europe’s leaders were split into irreconcilable camps, at least publicly, and seemed unlikely to agree on how to fund Kyiv, thanks partly to the reemergence of the same bitter north-south divisions over joint debt that torpedoed EU unity during the eurozone crisis. Only a few hours before the 27 leaders gather in Brussels, two opposing groups are crossing swords over whether to issue a loan to Ukraine based on frozen Russian central bank reserves, largely held by the Euroclear bank in Belgium. Germany along with Nordic and Eastern European countries say there is no alternative to that scheme. But they are running into hardening resistance from Belgium and Italy, which are gunning for Plan B: Support for Kyiv based on EU debt guaranteed by the bloc’s common budget. Bulgaria, Malta, Hungary and Slovakia are also against the use of the assets. In a stark illustration of the schism, Italian Prime Minister Giorgia Meloni said on Wednesday she would use the Council meeting to demand answers on the “possible risks” of leveraging the assets, while German Chancellor Friedrich Merz doubled down on the assets plan “to help end this war as quickly as possible.” ESCAPE PLAN The first contours of a potential route out of the impasse — one that would have to be hashed out during hours of negotiations — are beginning to take shape. European Commission President Ursula von der Leyen cautiously opened the door to joint debt on Wednesday morning during a speech at the European Parliament in Strasbourg. “I proposed two different options for this upcoming European Council, one based on assets and one based on EU borrowing. And we will have to decide which way we want to take,” she said. The key to such a plan would be carving Hungary and Slovakia — which both oppose giving further aid to Ukraine — out of the joint debt scheme, four EU diplomats told POLITICO. A deal could still be agreed at the Council among the 27 EU countries, but the ultimate arrangement would stipulate that only 25 would be involved in the funding. Agreeing such a scheme would give a crucial lifeline to Ukraine’s shattered public finances as its coffers risk running dry as early as next April. Hungary’s Viktor Orbán is already predicting the assets will not be discussed in Brussels, and that negotiations have shifted to joint loans. Multiple diplomats, however, retorted that Orbán was wrong and that the Russian assets were still “the only game in town.” CRUNCH TIME Despite growing political pressure on the EU to prove it can rise to meet the existential challenges facing Ukraine, diplomats from the rival camps were often skeptical on Wednesday that a compromise could be found. The idea of EU joint debt has for years been anathema to the northern member countries, who have been unwilling to underwrite bonds for highly indebted southern countries. “The closest [situations] to what’s happening now with frozen assets are the 2012-2013 financial crisis and Greece’s bailout in 2015,” said a senior EU diplomat who, like others quoted in this story, was granted anonymity to speak freely. With respect to the Ukraine war, the northerners deny they oppose the use of eurobonds over concerns about the solvency of other EU countries, but argue they prefer the assets because they would provide a greater long-term cash infusion to Ukraine. “This is not about frugals versus spenders. It’s about being pro-Ukraine or not,” said a second EU diplomat, adding that northern and eastern European countries have taken the lead in bankrolling Ukraine’s war needs over the past four years. BACKING THE BELGIANS Despite weeks of painstaking negotiations over the assets, efforts to bring Belgium around are backfiring. The country adamantly opposes using the Russian money held by Euroclear in Brussels, and has now attracted allies. “[The Commission] created a monster, and they’ve been eaten by it,” said a third EU diplomat, referring to the assets plan. Germany and its allies, however, warn there is still no alternative to targeting the Euroclear money. “If you want to do something together as Europeans, the reparations loan is the only way,” a fourth EU diplomat said. The idea behind the assets-based loan is that Kyiv would not have to repay it unless Moscow coughs up the billions-worth of reparations needed to rebuild Ukraine’s pulverized cities — an unlikely scenario. Belgian Prime Minister Bart De Wever is expected to push the Commission to explore joint debt during Thursday’s summit of EU leaders — in the hope that others around the table will echo his demands. His supporters claim the model “is cheaper and offers more clarity,” said a fifth EU diplomat. But critics point out it will also require the political blessing of Hungary’s pro-Russia Prime Minister Orbán — who has repeatedly threatened to torpedo further financial aid to Kyiv. The impasse would require the Commission to concoct a workaround to keep Ukraine afloat while allowing Orbán to save face, according to the four EU diplomats. In exchange for his support the Commission could spare Hungarian and Slovak taxpayers from having to pay for Ukraine’s defense.   “The Commission now pushes joint loans, but we will not let our families foot the bill for Ukraine’s war,” Orbán wrote on X on Wednesday afternoon. He added that “Russian assets will not be on the table at tomorrow’s EUCO [European Council].” However, a senior EU official was quick to reject the Hungarian leader’s claim that the Russian reserves were no longer in play. “The reparations loan is still very much on the table,” they said. Bjarke Smith-Meyer, Gabriel Gavin and Gerardo Fortuna contributed to this report

Less than 24 hours before EU leaders descend on Brussels for vital talks on financing Ukraine’s war effort, Belgium believes negotiations are going in reverse. “We are going backward,” Belgium’s EU ambassador, Peter Moors, told his peers on Wednesday during closed-door talks, according to two diplomats present at the meeting. The European Commission and EU officials are in a race against time to appease Belgian concerns over a €210 billion financing package for Ukraine that leverages frozen Russian state assets across the bloc. Belgium’s support is crucial, as the lion’s share of frozen assets lies in the Brussels-based financial depository Euroclear. Bart De Wever, the country’s prime minister, refuses to get on board until the other EU governments provide substantial financial and legal safeguards that protect Euroclear and his government from Russian retaliation — at home and abroad. One of the most sensitive issues for Belgium is placing a lid on the financial guarantees that currently stand at €210 billion. Belgium believes that the guarantees provided by other EU countries should have no limits in order to protect them under any scenario. Talks looked to be going in the right direction. The Belgians backed a Commission pitch for EU capitals to cough up as much as possible in financial guarantees against the Ukrainian package — only for Belgium’s ambassador to drop a bombshell at the end of the meeting. “I just don’t know anymore,” one diplomat said, on condition of anonymity in order to speak freely. A spokesperson for the Belgian permanent representation declined to comment. Another key demand from Belgium is that all EU countries end their bilateral investment treaties with Russia to ensure Belgium isn’t left alone to deal with retaliation from Moscow. But to Belgium’s annoyance, several countries are reluctant to do so over fears of retribution from the Kremlin. Moors said during the meeting that any decision on the use of the assets will have to be taken by De Wever, according to an EU diplomat. Belgium is pushing the Commission to explore alternative options to finance Ukraine, such as issuing joint debt — a position that’s gained traction with Bulgaria, Italy, and Malta. European Commission President Ursula von der Leyen cautiously opened the door to joint debt during a speech at the European Parliament in Strasbourg on Wednesday morning. “I proposed two different options for this upcoming European Council, one based on assets and one based on EU borrowing. And we will have to decide which way we want to take,” she said. But joint debt requires unanimous support, unlikely given Hungarian Prime Minister Viktor Orbán’s threats to veto further EU aid to Kyiv.  Moors proposed a possible workaround on Tuesday by suggesting triggering an emergency clause — known as Article 122 — that would nullify the veto threat. The Commission and Council’s lawyers rebuffed the Belgian pitch at the same meeting, saying it was not legally viable. The idea was first proposed by the president of the European Central Bank, Christine Lagarde, during a dinner of finance ministers last week, but has been challenged by Northern European countries. De Wever is expected to suggest this option during the meeting of EU leaders on Thursday.

The U.K. government issued the sanctioned Russian oligarch, Roman Abramovich, a final warning to pay £2.5 billion to Ukraine or face court action. In a statement, British Chancellor Rachel Reeves and Foreign Secretary Yvette Cooper said a license had been issued to permit the £2.5 billion proceeds from Abramovich’s sale of Chelsea Football Club to be transferred to humanitarian causes in Ukraine. If he fails to comply, the government is prepared to take the matter to court, they said. The multi-billion-pound proceeds of Abramovich’s sale of Chelsea Football Club are frozen in a bank account, where they have been since 2022, when the government sanctioned Abramovich over his ties to Vladimir Putin. Chelsea was sold by Abramovich to an American consortium after the U.K.’s sanctions watchdog permitted the sale. Abramovich had to demonstrate he would not personally benefit from the transaction — but the proceeds have remained untouched in a bank due to uncertainty over how exactly they will be used to support Kyiv. Previously, Abramovich said he would use the funds to help “all victims of the war.” This had been interpreted as help for both Russians and Ukrainians. Today, the government said it would consider any proposal toward humanitarian causes in Ukraine, as long as the funds do not benefit Abramovich or other sanctioned individuals. It added that any future gains earned by the funds can be spent more broadly, on “victims of conflict worldwide.” Prime Minister Keir Starmer said the government is “prepared to enforce” the commitment for the funds to reach Ukraine, “so that every penny reaches those whose lives have been torn apart by Putin’s illegal war.” Seizing the assets from Abramovich has presented a legal minefield. He has never been charged with a crime related to his sanctioned assets, which means the British government needs Abramovich’s consent to use the money as it remains his property. In both the U.K. and the European Union, the profits on sanctioned assets have been used to guarantee loans for Ukraine. Recently, European allies have drawn up plans to use the assets themselves to guarantee loans for Ukraine, though they have yet to reach a deal on frozen assets worth around €210 billion. Ukraine faces a projected budget shortfall of €71.7 billion next year.

Czech President Petr Pavel on Monday officially swore in the country’s new right-wing coalition government led by populist billionaire Andrej Babiš, which could join ranks with Hungary and Slovakia in opposing aid to Ukraine. The appointment ends weeks of uncertainty over whether the president would approve Babiš as Czechia’s new leader. Pavel said last week he would name Babiš prime minister after the tycoon pledged to divest his ownership of Agrofert, an agricultural conglomerate and a major recipient of EU subsidies. Babiš’ comeback (he previously served as PM from 2017 to 2021) poses a fresh headache for Europe as it struggles to finance aid to war-ravaged Ukraine. Over the weekend Babiš came out against a proposal to finance Kyiv via a loan based on Russia’s frozen assets, joining the growing list of countries that have rejected the instrument. “The European Commission must find other ways to finance Ukraine,” Babiš announced Saturday on Facebook. “Our coffers are empty, and we need every crown [unit of Czech currency] we have for our citizens.” The billionaire’s previous term in power was marked by clashes with Brussels over his conflict of interest related to Agrofert. Since then Babiš has steered his ANO party firmly to the right, joined the far-right European Parliament grouping Patriots for Europe, and threatened to cancel a Prague-led ammunition initiative that has delivered over 1 million rounds to Kyiv. Babiš won a parliamentary election in October and proceeded to clinch a coalition deal with the far-right Freedom and Direct Democracy (SPD) and right-wing Motorists. All three parties share a commitment to rolling back support for climate measures such as the ETS2 emissions trading system, and to opposing Brussels’ plans to ban combustion engines. ANO will hold nine ministerial posts in the new Cabinet, including the premiership, with the Motorists taking four and the SPD three. Speaking at the inauguration ceremony Pavel promised to closely monitor how the incoming government safeguards democratic institutions, including the media, the judiciary and the country’s security forces. Babiš earlier raised concerns about media freedom with his plan to reform public broadcasting by abolishing license fees and funding it through the state budget. The president also noted that Czechia’s key safety and economic guarantees stem from its EU and NATO membership. “That is why we should approach membership in these institutions with the utmost responsibility and be responsible, constructive members rather than rejecters,” Pavel said.