Money is as central to Europe’s vital support of Ukraine as ammunition and intelligence. Yet, the bloc’s most viable funding mechanism involves seizing billions of dollars worth of Russian assets that U.S. President Donald Trump has proposed taking over.
The first draft of Trump’s 28-point peace plan called for an investment scheme for Ukraine’s reconstruction controlled by the U.S. but financed by $100 billion in frozen Russian assets matched by another $100 billion from the European Union — with 50% of profits sent back to Washington.
The plan surprised Europeans, who have spent years fiercely debating the fate of Russia’s frozen fortune.
Those funds are central to European Commission President Ursula von der Leyen’s plan to both maintain pressure on Russia and increase support for Ukraine as mysterious drone incursions and sabotage operations rattle European capitals.
“I cannot see any scenario in which the European taxpayers alone will pay the bill,” she said Wednesday in Strasbourg, France to applause from lawmakers in the European Parliament.
The 27-nation EU has sent Ukraine almost $197 billion since Russia invaded Ukraine nearly four years ago. While there’s no consensus on how to provide more aid, there’s near unanimity on seizing the Russian assets to cover the estimated $153 billion for Ukraine’s budget and military needs for 2026 and 2027.The Commission has proposed paying that bill with joint debt taken on by the EU and grants by individual nations, but its main source is the $225 billion assets frozen at Euroclear, a Brussels-based financial institution.
That is, if the Trump administration doesn’t get them first.
Perks of the deal
Trump’s brash negotiating style left many in Europe suspecting he wants a quick deal that forces Europeans to make it work and pay for it. All while the U.S. profits.
Analysts say the proposal was essentially a U.S. attempt to snatch these assets, coming as Brussels and Washington relaunch trade negotiations over tariffs.
Agathe Demarais, a senior fellow at the Berlin-based European Council on Foreign Relations, said the proposal was akin to a “signing bonus” for a peace deal heavily slanted towards Russia.
Fabian Zuleeg, chief executive of the Brussels-based European Policy Centre, called the U.S. takeover of the assets “outrageous,” but suggested it might also be acceptable to Europeans “if that is ultimately the price to pay for a good deal.”
After intense discussions between the U.S., Germany, France, the United Kingdom and representatives from the European Commission, the investment scheme was removed from the new draft peace plan. Russia has already signaled its total rejection of the new draft.
