SOFIA— Economy Commissioner Valdis Dombrovskis warned that the EU might need to provide Ukraine with bridge funding if EU capitals don’t back the frozen assets loan plan soon.
“The longer we now run delays, the more challenging it will become. It may open questions on some possible bridging solutions,” Dombrovskis said in Sofia on the fringes of a high-level conference on the country’s incoming adoption of the euro.
The EU executive pitched combining EU guarantees with the cash balances of Russian assets held by Belgian-based Euroclear to support a loan to fill Ukraine’s $60 billion budget hole. But Belgium has so far blocked the plan, citing concerns about the legal and financial risks it could face.
To find a solution, EU capitals tasked the Commission with drafting a list of options to support Kyiv. “If we run further delays without deciding on a reparation loan or other feasible option for Ukraine … the question is, how will you provide financial support to Ukraine in early next year? So that’s the question we need to answer in this case,” the commissioner said, talking about a bridging solution.
He also pushed back against Belgium’s concerns that Russia can retaliate by filing a mountain of legal litigation. “The European Commission’s legal service has very thoroughly assessed all the legal risks or possible litigation risks and sees them as contained and, in any case, guarantees to be provided to Belgium is to cover potential financial risks Belgium may face,” Dombrovskis said.
The commissioner added that another option could be to provide Ukraine with grants, but that this path is even “more complicated” for EU countries.
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