Ukraine in financial difficulty, Kyiv asks EU to use €210 billion in frozen Russian assets

Ukraine has called on the European Union to use frozen Russian assets to help cover the country’s financial and military needs through 2027, which Kyiv estimates could reach $78 billion if allies do not increase their support.

Ukrainian Finance Minister Serhiy Marchenko made the request on Tuesday during a meeting with representatives of international donors and financial institutions in Brussels, as Euronews reports.

Marchenko argued that using frozen Russian assets would be a practical and fair solution to cover Ukraine’s extraordinary war expenses, preserve its debt sustainability and ensure Russia’s accountability for the war.

The EU currently holds around €210 billion in Russian central bank assets, most of which are held at the Belgian financial institution Euroclear.

Kyiv is short $78 billion for 2027

Marchenko presented figures on Ukraine’s financial situation for 2027.

Of the $52.6 billion in financial assistance needed from international donors, $20 billion has been secured so far, leaving a gap of $32.6 billion.

In addition, there are around $45 billion in defence funding allocations for which allies have not yet given guarantees.

When these needs are added together, the total financing gap is around $78 billion.

The situation has been further worsened by Russian attacks, which, according to the Ukrainian authorities, have disrupted economic activity, damaged the power grid, destroyed factories and made tax collection more difficult.

Marchenko said that for the first time since the start of the war in 2022, Ukraine had noticed problems in the functioning of its tax and customs administration.

Kyiv also warns of the consequences of restricted maritime traffic in the Black Sea, because of which Ukrainian farmers are having problems exporting grain to the world market.

Marchenko said Ukraine was grateful for that package, but assessed that it was not enough.

Sweden, the Netherlands, Spain and Poland, backed by the Baltic states, also called for examining new ways to use frozen Russian assets.

Belgium opposes such a move, while Italy and France, according to diplomats, are sceptical about using Russian central bank funds.

For now, the European Commission is trying to avoid a new vote that could lead to divisions among members and insists that the priority is implementing the €90 billion package, which has already been agreed.