German Chancellor Friedrich Merz called on the European Union to use frozen Russian assets to fund Ukraine's military needs, marking a radical shift from Berlin's previously skeptical stance on the issue.
In an article for the Financial Times, Merz stated that such a move could unlock an interest-free loan of 140 billion euros for Kyiv and demonstrate 'resilience' in countering Russian aggression.
The leader of Europe's largest economy and staunch supporter of Ukraine emphasized that the bloc must find a legal mechanism to utilize the assets, as it is necessary to 'systematically and massively raise the cost of Russian aggression.' The European Commission is currently considering options for using 194 billion euros of Russian assets held in the Euroclear central securities depository in Belgium.
Previously, EU governments, including Germany, resisted the confiscation of assets due to financial and legal risks, fearing undermining trust in the euro as a reserve currency and military escalation from Russia. However, the pressure to use frozen assets is increasing amid waning support for Ukraine from Donald Trump and his refusal to sign new sanctions against Moscow.
Following initial skepticism, the German Chancellor proposed using Russian assets to fund Ukraine's defense needs, which could contribute to a more effective pushback against Russian influence in the country. The consideration of options for using frozen Russian assets by the EU indicates growing pressure to optimize the use of these resources in the context of reduced support for Ukraine from other international players.