Rachel Reeves has joined three former senior European and Canadian politicians in urging the European Union to seize €210bn (£175bn) of frozen Russian sovereign assets to fund Ukraine's defence, warning that failing to act risks Europe's security.
In an article published in The Times, the former UK chancellor, alongside Annegret Kramp-Karrenbauer, Nathalie Loiseau and Chrystia Freeland, wrote that the time to act is now. The quartet argued the EU should take custody of the 210 billion euros of sovereign Russian assets it immobilised in 2022, which would be enough to bankroll Ukraine's defence into 2029. They warned Kyiv faces a 70-billion-euro financial hole next year and said the funding would eliminate the risk that elections in key EU member states next year might halt financial support for Kyiv.
A previous attempt to tap the funds failed over concerns the liability would fall on the Belgian bank holding most of them. The new proposal seeks to transfer custody directly to the EU, alongside the associated liabilities. The bloc would also provide cover to mitigate the risks if Moscow considers acts of retaliation. The group argued Moscow has an obligation under international law to pay compensation for its illegal invasion, and that using the funds would be more acceptable to citizens than spending more taxpayer money.
The intervention comes as Kyiv faces what the quartet called a desperate winter. Relations between the US and Ukraine are under strain, with President Trump pressing Kyiv to cut a deal with Moscow. The UK Budget this week included an additional £10bn support package for Ukraine, announced by John Healey. Putin has separately stated Russia is prepared for a potential war with Europe, though he added Moscow does not want one.
Ms Reeves and her co-authors said that without new funding, Kyiv's capacity to sustain its defence would be gravely impaired, undermining Europe's security. "Ukraine is ready to engage in peace talks as it has always been," they wrote. "But Russia must feel increased pressure to engage in genuine negotiations. The transfer of its accounts would provide this needed pressure."
Analysis
Why This Matters
- Addresses a critical funding gap for Ukraine as US support wavers under Trump and winter approaches.
- Tests the EU's willingness to take decisive legal and financial action on frozen Russian assets.
- Sets a potential precedent for the use of frozen sovereign assets to fund a country's defence during conflict.
Background
The European Union has held €210bn in Russian central bank assets since 2022. A previous attempt to use the funds failed due to legal liability risks for the holding bank. The new proposal involves transferring custody of the assets to the EU itself, bypassing the bank. It comes at a time of strained US-Ukraine relations and rising energy diplomacy between Washington and Moscow.
What to Watch
- Whether the EU formally adopts the proposal to take custody of the €210bn in assets.
- The outcome of upcoming elections in key EU member states that could influence financial support for Kyiv.
- The trajectory of US-Ukraine relations and whether President Trump increases pressure on Kyiv to negotiate a deal with Moscow.
Checked
12 claims in this story checked against 1 source: 12 supported.
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- SupportedReeves urges the EU to seize €210bn in frozen Russian assets for Ukraine.The Independent UK: “Reeves urges EU to ‘act now’ and seize £175bn of Russian assets to protect Ukraine. Rachel Reeves has urged the European Union to seize €210bn (£175bn) of frozen Russian assets to help Ukraine defend itself”
- SupportedReeves warned Kyiv faces a “desperate winter” as Trump presses it to cut a deal with Moscow.The Independent UK: “the former chancellor told Brussels that “the time to act is now” as Kyiv faces “a desperate winter”. She warned Kyiv is confronting a funding blackhole as Donald Trump seeks to pressure the nation “to cut a deal with Moscow”.”
- SupportedReeves joined three former senior European and Canadian politicians in urging the EU to use the assets to fund Ukraine’s defence.The Independent UK: “Ms Reeves wrote the rallying call in The Times alongside three fellow senior politicians - the former German defence minister Annegret Kramp-Karrenbauer, the former French minister for Europe Nathalie Loiseau and the former Canadian deputy prime minister and finance minister Chrystia Freeland.”
- SupportedReeves and her co-authors warned that failing to act risks Europe’s security.The Independent UK: “warning that failing to act now would risk the continent’s security”
- SupportedThe frozen assets total €210bn (£175bn), and the quartet said taking custody of them would bankroll Ukraine’s defence into 2029.The Independent UK: “A critical next step should be for the EU to take custody of the 210 billion euros of sovereign Russian assets it immobilised in 2022 so it can use them to help Kyiv in its defence.” The quartet pointed out the funding would be enough to bankroll Ukraine’s defence into 2029.”
- SupportedThe quartet said Ukraine faces a €70bn financial hole next year.The Independent UK: “It also faces a 70 billion-euro financial hole next year.”
- SupportedThe quartet said the funding would eliminate the risk that elections in key EU member states next year could halt financial support for Kyiv.The Independent UK: “This eliminates the risk that elections in key EU member states next year may halt financial support for Kyiv.”
- SupportedA previous attempt to tap the assets failed over concerns that liability would fall on the Belgian bank holding most of them.The Independent UK: “A previous attempt to tap into the funds last year to help Ukraine failed over concerns the liability would fall on the Belgian bank which held most of the assets”
- SupportedThe proposal would transfer custody of the frozen accounts to the EU, along with associated liabilities, and the bloc would provide cover against possible Russian retaliation.The Independent UK: “proposed to “transfer custody” of the frozen accounts to the EU itself, along with the associated liabilities. The bloc would also provide cover to mitigate the risks in the event Moscow “considers acts of retaliation”.”
- SupportedThe quartet argued that using the assets would be more acceptable to citizens than using more taxpayer money.The Independent UK: “Using these funds to help Ukraine defend itself would not only be just, it would also be more acceptable to our fellow citizens than using more European taxpayers’ money or further borrowing.”
- SupportedThe UK Budget this week included an additional £10bn support package for Ukraine, announced by John Healey.The Independent UK: “The funding was announced in Wednesday’s Budget by Ms Reeves’s successor John Healey.”
- SupportedThe co-authors wrote: “Ukraine is ready to engage in peace talks as it has always been,” and said transferring the accounts would pressure Russia to negotiate.The Independent UK: ““Ukraine is ready to engage in peace talks as it has always been. But Russia must feel increased pressure to engage in genuine negotiations. The transfer of its accounts would provide this needed pressure.””