EU leaders are engaged in critical discussions at a summit aimed at securing a vital funding deal for Ukraine, framed by some as a stark choice between “money today or blood tomorrow.” The primary focus revolves around an unprecedented proposal to utilize some of Russia’s approximately €210 billion sovereign assets, which have been frozen within the bloc since the full-scale invasion of 2022. Under the proposed scheme, the European Union would extend a €90 billion loan to Kyiv, intended to bolster Ukraine’s defense efforts amidst ongoing Russian territorial gains on the battlefield. Poland’s Prime Minister, Donald Tusk, underscored the urgency, stating that leaders faced a straightforward decision: “Either money today or blood tomorrow.”

Ukraine’s President, Volodymyr Zelenskyy, has expressed a strong desire for a funding decision by the end of the year, highlighting forecasts that his country could face bankruptcy by spring. Addressing EU leaders, Zelenskyy argued for holding the aggressor accountable, questioning why Moscow should retain any hope of reclaiming its funds despite its actions against Ukraine and Europe. He acknowledged Russia’s attempts to intimidate various countries over this decision but urged Europe not to succumb to threats, emphasizing that “we should be afraid of Europe being weak” instead.

The European Commission has presented two main options to address Ukraine’s estimated €136 billion funding requirements for 2026 and 2027. The first is a “reparations loan,” secured against the frozen Russian assets, which the Commission expects other Western allies to supplement. The second involves joint EU borrowing to finance Kyiv. Germany, along with other fiscally conservative nations like Sweden and the Netherlands, staunchly supports the reparations loan, preferring to utilize Russian assets over burdening European taxpayers. German Chancellor Friedrich Merz declared the reparations loan as the sole viable option: “We are basically faced with the choice of using European debt or Russian assets for Ukraine, and my opinion is clear: We must use the Russian assets.”

However, Belgium, which hosts the majority of the frozen Russian assets—approximately €185 billion in the Euroclear depository—has raised significant objections. Belgium’s Prime Minister, Bart De Wever, has demanded adequate and unlimited guarantees from the rest of the EU to protect Belgium and Euroclear from potential retaliatory legal claims by Russia. He metaphorically requested a “parachute” for collective jumping, stressing the need for confidence in the safety measures. A draft summit text, reviewed by The Guardian, pledged “full solidarity” and risk-sharing but lacked the detailed specifics on the speed and duration of such guarantees that Belgium sought.

Other EU member states also hold varying positions. Italy, Malta, and Bulgaria, for instance, favor an EU loan secured against unallocated funds within the existing EU budget. Italy’s Prime Minister, Giorgia Meloni, warned that using Russia’s assets without a solid legal basis could inadvertently hand Moscow “the first victory since the start of the war.” Conversely, common EU borrowing requires unanimous agreement from all 27 member states, a hurdle complicated by Hungary’s Prime Minister, Viktor Orbán, who has dismissed the idea of using frozen Russian assets as "stupid" and vowed to veto any joint debt "to finance a war that isn’t our’s.”

In response to these proposals, Russia’s central bank announced its intention to pursue damages against European banks for the “illegal blocking and use of its assets,” following a prior claim for $230 billion in damages from Euroclear. Security officials have reported that Euroclear itself has been subjected to an intimidation campaign. President Zelenskyy acknowledged these potential legal steps from Russia but stated they were “not as scary as when Russia is at your borders,” reinforcing his call for the reparations loan on grounds of European strategic interest, noting that much of the funds would be spent on European weapons, though some non-European equipment like US missile defense systems are also crucial.

Adding to the international context, the UK Foreign Secretary, Yvette Cooper, emphasized the importance of “mobilising” Russia’s frozen assets during a visit to Athens, citing Moscow’s continued aggression in Ukraine. She contrasted President Putin's intent to escalate conflict with the peace-seeking efforts of President Trump and President Zelenskyy. Meanwhile, a separate diplomatic initiative orchestrated by the Trump administration is unfolding, with US and Russian officials reportedly set to meet in Miami to discuss a peace plan, involving figures like Trump's envoy Steve Witkoff and son-in-law Jared Kushner, and Putin’s economic envoy Kirill Dmitriev.

Despite the complexities and differing views, French President Emmanuel Macron expressed confidence that leaders would find a solution, urging unity over technical details. European Commission President Ursula von der Leyen also affirmed her commitment not to leave the summit without a resolution. The summit is scheduled to conclude on Friday, with high stakes for Ukraine’s financial stability and European security.