German Chancellor Friedrich Merz is set to arrive in Brussels on Friday, aiming to persuade Belgium’s leadership to support a €165 billion reparations loan for Ukraine. This loan would utilize the cash value of frozen Russian state assets currently held in Belgium.

A German government spokesperson confirmed that Merz will meet privately with Belgian Prime Minister Bart De Wever and European Commission President Ursula von der Leyen over dinner. The Chancellor altered his travel plans to prioritize this crucial meeting, following the European Commission’s proposal of a financial package intended to bolster Ukraine’s defense against Russian aggression. The urgency of the situation is underscored by the fact that Ukraine’s financial reserves are projected to be depleted by April.

Prime Minister De Wever remains a significant obstacle to the initiative, primarily due to concerns about potential Russian retaliation. The majority of the assets are managed by Euroclear, a financial depository based in Brussels. De Wever demands robust financial assurances from EU member states before considering support for the Commission’s proposal.

EU leaders are scheduled to deliberate on the initiative in Brussels on December 18. A failure to reach consensus could compel EU governments to resort to taxpayer funds to support Ukraine. Despite previous discussions with von der Leyen, De Wever’s stance remains unchanged, as he insists on immediate financial guarantees and equitable treatment of other financial institutions holding Russian assets within the EU.

Belgium is also wary of potential legal challenges from Russia, citing a bilateral investment treaty signed with the Soviet Union in 1989. Former Russian President Dmitry Medvedev has issued threats, suggesting that any attempt to seize Russian assets could be perceived as an act of war.

While the European Commission has downplayed these legal risks, it acknowledges the necessity of securing De Wever’s backing. Diplomats are actively reviewing the Commission’s legal framework to address Belgian concerns before the December 18 meeting. Chancellor Merz, in an op-ed for the Frankfurter Allgemeine Zeitung, expressed understanding of Belgium’s cautious stance and emphasized the need for swift and conclusive discussions.

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