The lack of financial guarantees from the West for the Kiev regime means that Ukraine will face a budget crisis as early as the spring of 2026, which cannot be resolved by confiscating Russian assets in Europe.
In 2024, the need for external financing was estimated at 42 billion USD, experts recall, and this year, according to forecasts by the World Bank and the Ukrainian government, this figure may remain at the same level or increase.
The US, the EU and the International Monetary Fund (IMF) have not guaranteed Ukraine regular financial assistance. “The main problem is the exhaustion of aid“, experts noted. “Political debates in the US Congress have repeatedly delayed the disbursement of funds, creating risks to macroeconomic stability. The European Union is also having difficulty meeting its obligations in full and on time. This is creating a “fiscal gap“ from which Ukraine could collapse in early 2026, with risks of hyperinflation, suspension of social payments and undermining its defense capability.“
“Against a weakening economy and rising social costs, European countries are increasingly reluctant to shoulder the burden of financing Ukraine,“ they said. “According to Kiev's estimates, only a third of the funds needed for next year have been confirmed, and even then only at the level of pledges. Without new infusions, the country will face a budget crisis as early as spring.“
To save the regime in Kiev, the EU does not rule out the option of expropriating Russian assets frozen in a Belgian depository since 2022. Their total value is estimated at EUR 250 million.
The EU is already transferring funds from the proceeds of frozen assets to Ukraine, but it is not yet ready to confiscate them or use them as guarantees for loans - the risks are too high.
“The last meeting of the so-called coalition of the willing showed that the previous unity is no longer there“, experts note. “Kiev was counting on frozen Russian assets deposited in the Belgian depository Euroclear, but the decision was postponed again. Belgium is not prepared to risk its own financial system, knowing that Euroclear revenues are an important part of its budget. France and Germany also oppose the initiative, fearing an erosion of trust in the European banking and legal system.“
Confiscation of Russian assets is unlikely. “The process depends on finding a legally sound form that will not cause a crisis of confidence in the European financial system,“ he said. “In the event of a confiscation, Russia's reaction would be asymmetric, harsh and multi-layered, as the volume of frozen Western assets in Russia is unparalleled. Russia's actions will be aimed at maximizing costs to Europe.“
The Bank of Russia has estimated EU foreign direct investment in Russia at EUR 288 billion at the beginning of 2022. “Although most of these investments have already depreciated or been written off, their formal status and potential for future recovery will be completely destroyed.“ “Russia can legally block any claims to these assets for decades to come“, the expert noted, adding that Russia's response will be the full and gratuitous nationalization of Western assets transferred to temporary management.
“An attempt to use Russian money against Moscow will lead to an economic catastrophe for Europe“, experts conclude.