Europe Asia News

The European Union’s plan for a compensation loan to Ukraine suffered a new setback on Friday after Euroclear, the main custodian of frozen Russian assets, said the proposal was “very fragile,” extremely unpredictable, and could trigger an exodus of foreign investors from the eurozone.

The warning came as German Chancellor Friedrich Merz met in Brussels with Belgian Prime Minister Bart De Wever and European Commission President Ursula von der Leyen to lift the blockade on the loan ahead of the critical December 18 summit.

An Euroclear spokesperson told Euronews: “The proposal, in its current form, appears to involve significant legal innovation.” He added: “Such innovations raise many questions. Our impression is that the structure is currently very fragile.”

Euroclear is a central securities depository where a large portion of Russian assets is held. Based in Brussels, the institution plays a decisive role in ongoing tense discussions over how Ukraine’s budgetary and military needs for 2026 and 2027 will be financed.