European diplomats are trying to find a last-minute compromise that would save the agreement to provide Ukraine with vital financial assistance at the EU leaders' summit, which will take place on Thursday, December 18. Politico reports this, citing sources in European institutions.
According to the publication, on the eve of the summit in the European Union, a deep split has formed between the countries of Northern and Southern Europe. The leaders of the states have actually divided into two irreconcilable camps regarding the mechanism of financing Kyiv. The main dispute revolves around the question of whether it is possible to provide loans to Ukraine at the expense of the frozen reserves of the Central Bank of Russia, a significant part of which is stored in the Belgian financial institution Euroclear.
Germany, along with the countries of Northern and Eastern Europe, insist that there is no alternative to using Russian assets. At the same time, Belgium and Italy are increasingly promoting the so-called Plan B - financing Ukraine through joint EU debt guaranteed by the general budget of the union. Bulgaria, Malta, Hungary and Slovakia also oppose the use of frozen assets.
European Commission President Ursula von der Leyen on Wednesday proposed two parallel options for exiting the crisis: a model based on Russian assets and an alternative scenario involving joint EU borrowing. According to four EU diplomats, a key element of the compromise could be the exclusion of Hungary and Slovakia from the joint debt repayment scheme, as these countries are systematically blocking further support for Ukraine.
Despite Hungarian Prime Minister Viktor Orban's statements that the issue of Russian assets will supposedly no longer be discussed in Brussels, a number of European diplomats dispute this position. According to them, using frozen Russian funds remains the "only real option" to ensure stable financing for Ukraine.
The idea of a common EU debt has traditionally met with resistance from northern countries, which for years have been reluctant to guarantee bonds for more indebted southern states. Diplomats compare the current situation to the financial crisis of 2012-2013 and the Greek bailout programs in 2015. At the same time, representatives of northern countries emphasize that their position is not related to fears about the solvency of partners, but to the desire to provide Ukraine with a long-term and predictable financial resource.
Belgian Prime Minister Bart de Wever is expected to push for a detailed examination of the joint debt model at the summit. Its supporters see it as cheaper and more transparent. However, critics say such an approach would require political approval from Viktor Orban, who has repeatedly threatened to block any decisions on aid to Ukraine.
Diplomats say that if the impasse persists, the European Commission will have to find workarounds for funding to ensure that Ukraine is not left without support while allowing individual countries to save political face. Possible options include exempting Hungarian and Slovak taxpayers from contributing to Ukraine's defense in exchange for their governments lifting their vetoes.
