Late on Thursday night, EU leaders finally accepted that their ambitious Ukraine funding plan had failed.
They had spent months debating an unprecedented proposal to use frozen Russian central bank assets.
The plan aimed to transform those assets into a zero-interest reparations loan for Ukraine.
Supporters viewed the idea as morally justified and politically powerful.
Opponents feared legal uncertainty, financial exposure, and long-term consequences.
As talks reached their final hours, political courage gave way to caution.
Leaders grew uneasy about crossing legal and financial lines without clear precedent.
Rather than risk unpredictable fallout, they turned to a familiar solution.
The European Union will now raise €90 billion through joint borrowing on markets.
The €210 billion in frozen Russian assets will remain immobilised.
Belgian Prime Minister Bart De Wever played a decisive role in blocking the plan.
He warned that seizing Russian assets would expose Europe to serious financial liabilities.
He argued that governments seek certainty when potential risks multiply quickly.
His position ultimately found support among increasingly hesitant member states.
How the Proposal Gained Support and Lost Trust
The idea entered the public debate on 10 September in Strasbourg.
European Commission President Ursula von der Leyen raised it during her State of the EU address.
She suggested using profits from frozen Russian assets to help fund Ukraine’s resistance.
Her speech offered political clarity but very little technical detail.
She argued Russia should pay for the destruction it caused.
German Chancellor Friedrich Merz soon amplified the proposal.
He endorsed it in a Financial Times opinion article.
He presented approval as both realistic and politically necessary.
Many diplomats felt caught off guard by his confidence.
Some accused Germany of pushing the bloc without proper consultation.
The Commission later circulated a short document outlining the concept.
Belgium reacted strongly to that move.
The country holds about €185 billion of frozen Russian assets through Euroclear.
Belgian officials felt sidelined despite carrying the largest financial exposure.
De Wever publicly warned against spending Europe’s strongest leverage over Moscow.
He demanded full legal certainty and shared financial responsibility.
An October summit failed to deliver agreement.
Leaders asked the Commission to explore several funding options instead.
Why the Plan Finally Fell Apart
In November, von der Leyen presented three funding options to leaders.
They included voluntary contributions, joint debt, and the reparations loan.
She acknowledged that none of the choices offered an easy solution.
Her letter tried to address Belgium’s concerns with stronger guarantees.
It also warned of reputational and financial risks for the eurozone.
External events briefly revived support for the proposal.
US and Russian officials circulated a controversial peace framework.
That plan suggested exploiting frozen assets for shared commercial benefit.
European leaders rejected the idea outright.
Momentum collapsed again after De Wever sent a sharply critical letter.
He described the proposal as fundamentally flawed and potentially dangerous.
In December, the Commission released detailed legal texts.
The European Central Bank refused to provide liquidity support.
Euroclear criticised the plan as fragile and risky for investors.
Several northern and eastern states defended the proposal publicly.
Opposition widened when Italy, Bulgaria, and Malta raised objections.
At the 18 December summit, leaders faced unlimited guarantees and massive liabilities.
They abandoned the reparations loan and chose joint debt instead.
De Wever said the outcome confirmed his expectations.
He argued that no financial solution comes without real costs.
