Ukraine Opposes Using Frozen Russian Assets as Leverage in Peace Negotiations

Ukraine has firmly opposed the use of frozen Russian assets as leverage in peace negotiations, emphasizing that such actions would only extend the conflict. Iryna Mudra, deputy head of President Volodymyr Zelensky's office in charge of legal matters, stated, "Keeping the assets permanently 'on ice' or turning them into a bargaining chip between Russia and another power only prolongs the conflict."

European leaders have been deliberating a €140 billion loan to Ukraine, backed by these frozen Russian central bank reserves. However, consensus has yet to be reached on this proposal. The assets in question were also mentioned in a 28-point peace plan, which suggested allocating a portion to a U.S.–Russia investment vehicle. Mudra criticized this approach, asserting, "Any idea that a sizable chunk of frozen Russian sovereign assets could be split between Russia and the United States as part of a peace deal is fundamentally wrong in law and in principle."

A revised 19-point plan, developed with input from Ukrainian and European representatives, reportedly omits references to the frozen assets. When asked about the current status of these assets in the peace negotiations, Mudra declined to comment but emphasized Ukraine's legal claim to the funds, stating, "These assets are directly linked to Russia’s unlawful aggression against Ukraine, and under international law — already belong to Ukraine."

Ukraine is facing significant financial challenges and is heavily reliant on European allies for both military and economic support. European Commission President Ursula von der Leyen highlighted the need for a structured solution, proposing a reparations loan based on immobilized Russian assets. She clarified, "There is no seizing of the assets. Ukraine has to repay the loan if Russia is paying reparations."

Approximately $300 billion of Russian central bank reserves were frozen following the full-scale invasion, with the majority held in Belgium. The World Bank estimates that Ukraine requires around $524 billion for recovery and reconstruction efforts. Ukrainian lawmaker Inna Sovsun emphasized the importance of these assets, stating, "Your biggest leverage is the Russian assets."

European leaders continue to debate the best approach to utilize these frozen assets to support Ukraine, balancing legal considerations and the need for financial assistance.