Connect with us

World

EU leaders agree joint borrowing to fund Ukraine, setting aside plan to use Russian frozen assets

Published

on

European Union leaders decided on Friday to borrow cash to fund Ukraine’s defence against Russia for the next two years rather than use frozen Russian assets, sidestepping divisions over an unprecedented plan to finance Kyiv with Russian sovereign cash.

“Today we approved a decision to provide 90 billion euros to Ukraine,” EU summit chairman Antonio Costa told a news conference early on Friday morning after hours of talks among the leaders in Brussels, Reuters reported. “As a matter of urgency, we will provide a loan backed by the European Union budget.”

The leaders also gave the European Commission a mandate to keep working on a so-called reparations loan based on Russian immobilised assets but that option proved unworkable for now, above all due to resistance from Belgium, where the bulk of the assets is held.

The idea of EU borrowing initially seemed unworkable as it requires unanimity and Hungary’s Russia-friendly Prime Minister Viktor Orban had opposed it. But Hungary, Slovakia and the Czech Republic agreed to let the scheme go ahead as long as it did not impact them financially.

The EU leaders said Russian assets, totalling 210 billion euros in the EU, will remain frozen until Moscow pays war reparations to Ukraine. If Moscow ever takes such a step, Ukraine could then use they money to pay back the loan.

USE OF RUSSIAN ASSETS TO COMPLEX AT THIS STAGE

“This is good news for Ukraine and bad news for Russia and this was our intention,” German Chancellor Friedrich Merz said.

The stakes for finding money for Kyiv were high because without the EU’s financial help, Ukraine would run out of money in the second quarter of next year and most likely lose the war to Russia, which the EU fears would bring closer the threat of Russian aggression against the bloc.

The decision follows hours of discussions among leaders on the technical details of an unprecedented loan based on the frozen Russian assets, which turned out to be too complex or politically demanding to resolve at this stage.

The main difficulty was providing Belgium, where 185 billion euros of the total Russian assets in Europe are held, with sufficient guarantees against financial and legal risks from potential Russian retaliation for the release of the money to Ukraine.

“There were so many questions on the Reparations Loan, we had to go to Plan B. Rationality has prevailed,” Belgian Prime Minister Bart De Wever told a news conference. “The EU has avoided chaos and division and remained united,” he said.

HUNGARY SCORES A WIN

With public finances across the EU already strained by high debt levels, the European Commission had proposed using the Russian assets for a loan to Kyiv or joint borrowing against the EU budget.

Using the latter option allowed Orban to claim a diplomatic victory.

“Orban got what he wanted: no reparation loan. And EU action without participation of Hungary, Czech Republic and Slovakia,” one EU diplomat said.

‘CAN’T AFFORD TO FAIL’

Several EU leaders arriving at the summit said it was imperative they find a solution to keep Ukraine financed and fighting for the next two years. They were also keen to show European countries’ strength and resolve after U.S. President Donald Trump last week called them “weak”.

“We just can’t afford to fail,” EU foreign policy chief Kaja Kallas said.

Ukrainian President Volodymyr Zelenskiy, who took part in the summit, urged the bloc to agree to use the Russian assets to provide the funds he said would allow Ukraine to keep fighting.

“The decision now on the table – the decision to fully use Russian assets to defend against Russian aggression – is one of the clearest and most morally justified decisions that could ever be made,” he said.

World

Top US, Israeli generals meet at Pentagon amid soaring Iran tensions

The officials did not offer details about the closed-door discussions between U.S. General Dan Caine, the chairman of the Joint Chiefs of Staff, and Eyal Zamir, the Israeli armed forces chief of staff.

Published

on

The top U.S. and Israeli generals held talks at the Pentagon on Friday amid soaring tensions with Iran, two U.S. officials told Reuters on Sunday, speaking on condition of anonymity, Reuters reported.

The officials did not offer details about the closed-door discussions between U.S. General Dan Caine, the chairman of the Joint Chiefs of Staff, and Eyal Zamir, the Israeli armed forces chief of staff. The meeting has not been previously reported.

The United States has ramped up its naval presence and hiked its air defences in the Middle East after President Donald Trump repeatedly threatened Iran, trying to pressure it to the negotiating table. Iran’s leadership warned on Sunday of a regional conflict if the U.S. were to attack it, read the report.

Israeli Defence Minister Israel Katz on Sunday met with Zamir after his talks in Washington, Katz’s office said, to review the situation in the region and the Israeli military’s “operational readiness for any possible scenario.”

Continue Reading

World

Israeli attacks kill 31 Palestinians in Gaza, including children

Published

on

At least 31 Palestinians, including six children, were killed in Israeli attacks on Gaza City and Khan Younis since early Saturday, according to medical sources cited by Al Jazeera.

The strikes came a day before Israel is scheduled to reopen the Rafah crossing between Gaza and Egypt on Sunday, marking the first reopening of the border crossing since May 2024.

Gaza’s Government Media Office said that more than 500 Palestinians have been killed by Israeli forces since a United States-brokered ceasefire came into effect on October 10.

According to local health authorities, Israel’s military campaign in Gaza has killed at least 71,769 Palestinians and wounded 171,483 others since it began in October 2023. In Israel, at least 1,139 people were killed during the Hamas-led attacks on October 7, 2023, with approximately 250 people taken captive.

Continue Reading

World

Guterres warns of UN’s ‘imminent financial collapse’

In his letter, Guterres said “decisions not to honour assessed contributions that finance a significant share of the approved regular budget have now been formally announced.”

Published

on

The U.N. chief has told member states the organisation is at risk of “imminent financial collapse,” citing unpaid fees and a budget rule that forces the global body to return unspent money, a letter seen by Reuters on Friday showed.

U.N. Secretary-General Antonio Guterres has repeatedly spoken about the organisation’s worsening liquidity crisis but this is his starkest warning yet, and it comes as its main contributor the U.S. is retreating from multilateralism on numerous fronts.

“The crisis is deepening, threatening programme delivery and risking financial collapse. And the situation will deteriorate further in the near future,” Guterres wrote in a letter to ambassadors dated January 28.

The U.S. has slashed voluntary funding to U.N. agencies and refused to make mandatory payments to its regular and peacekeeping budgets.

U.S. President Donald Trump has described the U.N. as having “great potential” but said it is not fulfilling that, and he has launched a Board of Peace which some fear could undermine the older international body.

Founded in 1945, the U.N. has 193 member states and works to maintain international peace and security, promote human rights, foster social and economic development, and coordinate humanitarian aid.

In his letter, Guterres said “decisions not to honour assessed contributions that finance a significant share of the approved regular budget have now been formally announced.”

He did not say which state or states he was referring to, and a U.N. spokesperson was not immediately available for comment.

Under U.N. rules, contributions depend on the size of the economy of each member state. The U.S. accounts for 22% of the core budget followed by China with 20%.

But by the end of 2025 there was a record $1.57 billion in outstanding dues, Guterres said, without naming the nations that owed them.

“Either all Member States honour their obligations to pay in full and on time – or Member States must fundamentally overhaul our financial rules to prevent an imminent financial collapse,” he said.

U.N. officials say the U.S. currently owes $2.19 billion to the regular U.N. budget, another $1.88 billion for active peace-keeping missions and $528 million for past peace-keeping missions.

The U.S. State Department did not immediately respond to a request for comment on the Guterres letter.

Guterres launched a reform task force last year, known as UN80, which seeks to cut costs and improve efficiency. To that end, states agreed to cut the 2026 budget by around 7% to $3.45 billion.

Still, Guterres warned in the letter that the organisation could run out of cash by July.

One of the problems is a rule now seen as antiquated whereby the global body has to credit back hundreds of millions of dollars in unspent dues to states each year.

“In other words, we are trapped in a Kafkaesque cycle expected to give back cash that does not exist,” said Guterres, referring to author Franz Kafka who wrote about oppressive bureaucratic processes.

Continue Reading

Trending

Copyright © 2025 Ariana News. All rights reserved!