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Merz wants to use Russian assets for Ukraine loan

Federal Chancellor Friedrich Merz wants to make almost 140 billion euros available to Ukraine in the form of an interest-free loan, financed with the Russian Central Bank’s assets frozen in Europe. “This loan would not be repaid until Russia has compensated Ukraine for the damage it has caused,” Merz writes in an article for the Financial Times. The funds are intended to strengthen Ukraine militarily for its continued defence against Russia.

The EU has committed to supporting Ukraine for as long as necessary, Merz writes by way of justification. If the plan is implemented, EU member states would, for the time being, no longer have to finance most of the upcoming support for Ukraine from their own budgets. Instead, they would only need to provide guarantees in the event that the frozen Russian funds have to be unexpectedly released again.

“We need renewed impetus to shift Russia’s calculations,” Merz writes. “Now we must apply an effective lever to break through the cynical waiting game of the Russian president and force him to the negotiating table. That requires courage and confidence to set our own agenda instead of merely reacting to his.”

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