BERLIN

German Chancellor Friedrich Merz expressed hope Thursday that EU leaders will agree to provide Ukraine with a €140 billion ($162 billion) loan backed by frozen Russian assets.

Speaking to reporters in Brussels ahead of an EU leaders summit, Merz said they will discuss ways to increase support for Ukraine and strengthen the EU's defense capabilities, among other issues.

“We will discuss Russian assets. I am grateful that my proposal has met with broad approval. However, there are a few serious objections that we need to discuss,” Merz told reporters.

“This concerns in particular the Belgian state and its liability. This is an issue that we will be addressing today. But I believe we will also make progress on this matter.”

Last month Merz proposed providing Ukraine with an interest-free loan of almost €140 billion backed by frozen Russian assets to strengthen Kyiv's military capabilities and bring Moscow to the negotiating table. Merz argued that this can be done by leveraging frozen Russian Central Bank assets in Europe without confiscating them – addressing legal concerns while providing substantial financial support.

However, Belgium – which hosts the European financial body that holds the frozen assets – has raised objections. The Belgian government voiced concerns that it may face legal problems and could bear the financial liability itself. It has insisted that the financial and legal risks of this proposal must be shared among all EU member states.