Politico: EU preparing €210 billion in guarantees for Ukraine loan, with Germany leading with €52 billion

The European Union should separately provide billions of euros in guarantees for a loan to Ukraine worth up to €210 billion from frozen Russian assets. Germany could provide up to €52 billion, reported Politico, citing documents that were obtained by the media.

Last week, the European Commission presented the amounts to diplomats after announcing a €165 billion reparations loan to Ukraine. It is to be based on the monetary value of frozen Russian assets.

The guarantees, which will be distributed proportionally among the EU countries, are necessary to obtain approval of the loan by Belgian Prime Minister Bart de Weever. Politics opposes the use of sovereign Russian assets because of the risk that the country may be liable for repayment to Moscow.

About €185 billion of frozen Russian assets are managed by the Brussels-based Euroclear depository. Another €25 billion is placed in private bank accounts in various EU countries.

The total amount of payments for each participant may increase if some countries, such as Hungary, do not join the initiative. At the same time, some non-EU countries could also assume part of the guarantees if they wish. In particular, Norway was considered as a possible participant until the Minister of Finance Jens Stoltenberg distanced Oslo from this idea.

During the meetings german Chancellor Friedrich Merz with de Weever in Brussels, the German leader assured that Berlin would provide 25% of the guarantees. This is the largest share of all countries. According to him, Belgium's concerns about the use of frozen Russian assets should be taken into account so that all EU states bear the same risks.

"Belgium's particular concern about how to use the frozen Russian assets is undeniable and should be addressed by any possible solution so that all European states bear the same risk," Merz said.

The article also notes that the proposed reparations loan provides €115 billion to support Ukraine's defense industry over five years, €50 billion for budgetary needs, and another €45 billion to repay last year's G7 loan. The European Commission proposes to make the payments in six tranches throughout the year.

Control mechanisms are also envisaged. These include reviewing contracts and spending plans, as well as detailing Ukraine's financial needs to track the flow of funds.

• december 5, Bloomberg reportedthe US has called on EU countries not to support the use of frozen Russian assets for a "reparations loan" to Ukraine.
• december 8, Financial Times wrotethe French media reported that France supported the European Commission's proposal for a reparations loan for Ukraine, but opposed the participation of French commercial banks in this scheme. They hold about 18 billion euros of Russian state assets.