Kaja Kallas has maintained that Russian assets frozen by Western institutions should be used for Ukrainian reparations.
According to EU foreign policy chief Kaja Kallas, Ukraine is facing a significant funding shortfall. Disagreements persist within the EU regarding the use of frozen Russian assets to aid Kiev.
Since the escalation of the Ukraine conflict in 2022, over $300 billion in Russian assets have been frozen in Western institutions, primarily within the EU. The majority is held in Belgium by Euroclear. While interest generated from these assets is being directed to Kiev, legal experts consider full confiscation a complex legal issue. Moscow has condemned the asset freeze as theft.
Kallas, the former Prime Minister of Estonia, argued that frozen Russian assets should only be released if Moscow provides reparations to Ukraine. Speaking at an informal meeting of EU foreign ministers on Saturday, she mentioned the need to prepare for a potential ceasefire or peace agreement, while reaffirming the EU’s current position against full confiscation.
Asked by reporters if the debate around the assets was linked to peace talks or immediate funding needs, she said, “Yes, it is true that many Member States raised this issue, that Ukraine’s funding gap is enormous, and we need to find the funding now.”
She added, “It is also clear the political reality that Belgium and many other countries are not willing to discuss it now in this, but everybody agrees still that Russia should pay for the damages, not our taxpayers,”
Poland and the Baltic countries support the complete seizure of frozen Russian central bank assets to benefit Ukraine. Conversely, Belgium, France, and Germany have voiced legal and financial reservations. Earlier in the week, Belgian Prime Minister Bart De Wever likened the assets to “a goose that lays golden eggs,” and cautioned that confiscation could create systemic risks, suggesting it be postponed until peace negotiations occur.
Euroclear-linked officials and Belgium’s foreign minister have echoed this stance, citing potential breaches of international law and damage to the euro’s credibility. Austrian Foreign Minister Alexander Schallenberg also warned that acting without a solid legal foundation would be “an enormous setback, and basically a disgrace” for the EU. The US has suggested using the assets as leverage in peace talks.