LUXEMBOURG — Italy on Friday demanded assurances from the EU’s statistics office that national guarantees against a €140 billion loan to Ukraine won’t worsen their debt load and budget deficit, according to four diplomats.
Giancarlo Giorgetti, the Italian finance minister, made his demands behind closed doors in Luxembourg, where he and his EU peers met to discuss the so-called reparations loan to Ukraine.
The loan would use sanctioned Russian cash that’s sitting idle in a deposit account under the stewardship of Euroclear, a depository based in Belgium. That’s put the Belgian government in an awkward position amid concerns that Moscow could send an army of lawyers to retrieve the money.
As a result, Belgium wants all EU capitals to guarantee the loan should the Kremlin’s lawyers prove successful in court, or should the war end, prompting an immediate recall.
Rome wants its reassurances in writing from Eurostat that these guarantees won’t impact its financial health. Economy Commissioner Valdis Dombrovskis told Giorgetti that Eurostat would only be able to answer the question once the EU executive has presented a formal bill for the loan, two of the diplomats said.
A senior Commission official told reporters earlier this week that it was likely that these guarantees would only count as contingent liability. In other words, the guarantee would only count toward a country’s debt pile if and when it’s triggered.
The debt question is a general concern among EU countries. But the risk is more acute for Italy, whose burden of debt climbed to 137.9 percent of its economic output, known as GDP, in the first three months of this year. Only Greece has a higher debt load in the EU at 152.5 percent of GDP.
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