Japan Rejects EU Plan to Use Frozen Russian Assets for Ukraine Funding

By Staff, Agencies

Japan has reportedly rejected a European Union proposal to use frozen Russian sovereign assets as collateral for a large “reparation loan” to Ukraine. The initiative, backed by Brussels, aims to help cover Kiev’s massive budget deficit but has been condemned by Moscow as an act of theft.

Belgium, which hosts the bulk of the immobilized funds through the Euroclear clearinghouse, has refused to approve the plan without broader international burden-sharing.

Prime Minister Bart De Wever has argued that support from non-EU countries holding Russian assets would strengthen the European Commission’s legal position.

However, at a meeting of G7 finance ministers on Monday, Japan’s Satsuki Katayama indicated Tokyo would not support the plan due to legal restrictions, Politico reported.

EU officials believe Japan’s stance mirrors that of the United States, which also opposes the initiative and prefers to retain the frozen assets as leverage in future negotiations with Moscow.

France has likewise declined to use assets located on its territory, while Canada and the UK have signaled potential participation if the EU moves forward.

Meanwhile, Ukraine’s parliament last week approved a 2026 budget with a $47.5 billion deficit.

The government expects foreign donors to cover a significant portion of the gap, but roughly $23.6 billion in anticipated support remains uncertain as the EU loan plan hangs in the balance.

Lawmakers pushed the budget through despite unresolved financing issues, seeking to project stability following the dismissal of top presidential aide Andrey Yermak amid a widening corruption scandal.