From Denys Davydov:
London this week becomes the place of the first truly important meeting in the endless series of summits that now accompany the war in Ukraine. Today Zelensky is flying in for a meeting with Friedrich Merz, Emmanuel Macron, and Keir Starmer. The leaders of the so-called "European Trio" have recently become the main axis of decision-making in Europe, writes The Economist.
But this week the most important decisions about Ukraine's future are being made not in Brussels as the capital of the EU, but in Brussels as the capital of Belgium.
On December 3, the European Commission presented a proposal to use frozen Russian assets (about 210 billion euros) as collateral for a loan to Ukraine — initially 90 billion, but possibly more eventually. This will allow Kyiv to finance the government and the war for at least the next couple of years. Without new aid, Ukraine could run out of money as early as March–April.
Whether Ukraine receives the loan depends mainly on whether EU countries can convince the Belgians to agree with the Commission.
It is unclear what might change the mind of Belgian Prime Minister Bart De Wever. His main concern is that small Belgium will remain "on the hook" for 185 billion euros of Russian assets if Russia demands their return.
The EU reassures — banks holding the assets will be obliged to lend the EU an equivalent amount, the EU will transfer it to Ukraine and will itself be responsible for repaying the banks. The risk will be borne by the entire bloc.
Russia will eventually have to return these assets as reparations to Ukraine — otherwise sanctions will not be lifted. But De Wever fears that some country (for example, Hungary, friendly to Russia) might block the continuation of sanctions without reparations — and Russia will demand the money back.
The EU plan makes it impossible for sanctions to be lifted by a single country: it proposes using another basis — an extraordinary economic situation in the EU (which has never happened before), requiring only a qualified majority. However, some lawyers consider the legal logic of the plan questionable: is covering the loan to Ukraine really an "extraordinary economic situation" for the EU (about 1% of the bloc's GDP)?
So far, De Wever has not been convinced. He says there are other mechanisms to finance Ukraine — for example, loans secured by the EU budget. His opposition to the European Commission is currently very popular in Belgium. On December 4, speaking in parliament, he did not hear a single vote against.
European diplomats fear that De Wever has dug in so deeply that it will be hard to get out. Chancellor Merz — the biggest supporter of the reparations loan — flew to Brussels on December 5 for dinner with the Belgian and European Commission President Ursula von der Leyen. But the deal remains distant.
?? Meanwhile, the US is actively lobbying against the reparations loan, believing that the return of assets should be a "carrot" for Russia to agree to peace.
The official program of the London meeting has not been published, but most likely it will be about not so much the frozen assets as the reaction to the latest zigzags of American and Russian diplomacy. One Ukrainian official called the meeting a "support club" for Ukrainian and European leaders.
Last week Putin rejected the latest American-Ukrainian version of the peace proposal, which Steve Witkoff brought to Moscow. European leaders do not know whether to rejoice — now Russia is to blame for the deadlock in negotiations — or fear that the Americans will come up with something new.
The proposal to use frozen Russian assets as collateral for a large EU loan to Ukraine has become a key test of European resolve. So far, governments continue to allocate money from their budgets. Last week Germany gave 100 million for the restoration of Ukrainian energy, the Netherlands — 250 million for weapons.
According to the EU's legal logic, it could push the frozen assets plan even without Belgium's consent, but with the risk of a deep internal split.
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