Belgium welcomes EU proposal to give Ukraine profits from Russia assets

By Thomson Reuters Mar 21, 2024 | 3:57 AM

By Kate Abnett and Julia Payne

BRUSSELS (Reuters) – Belgian Prime Minister Alexander De Croo on Thursday welcomed a European Union proposal to use billions of euros in profits from frozen Russian financial assets to buy arms for Ukraine, ahead of a summit where EU country leaders will debate the plan.

The European Commission, the EU’s executive body, this week proposed taking profits – estimated at 2.5-3.0 billion euros ($2.7-3.3 billion) per year – from Russian assets frozen in Europe after Moscow’s invasion of Ukraine and transferring some 90% to Kyiv.

The assets are frozen by EU central securities depositories, mainly Belgium’s Euroclear.

“It’s a good proposal,” De Croo told Reuters in an interview.

“I think it’s a sensible way of doing it. I think the idea to allocate it predominantly to the purchase of weapons makes total sense,” he said.

Under the Commission proposal, 90% of the profits will be channelled through the European Peace Facility fund to buy weapons for Ukraine. The rest will be used for recovery and reconstruction.

Ukraine would also receive the tax that the Belgian government puts on the profits. For 2024, this is expected to amount to 1.7 billion euros, of which 1.5 billion euros will be paid this year.

The total financial contribution for Ukraine from frozen Russian assets in the EU could therefore total about 4.0-4.5 billion euros this year.

Russia said on Wednesday the Commission’s plan amounted to “banditry and theft” and would lead to decades of lawsuits.

Leaders from the 27 EU countries will discuss the proposal at a summit on Thursday. De Croo said he had heard “only positive comments” from other leaders on the proposal so far.

($1 = 0.9173 euros)

(Reporting by Kate Abnett and Julia Payne; Editing by Mark Potter)