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EU foreign ministers approved €1.4 billion (US$1.5 billion) in military aid for Ukraine, with the package to be financed for the first time by proceeds from frozen Russian Central Bank assets, top EU diplomat Josep Borrell announced on Monday.
The approval comes as a welcome boost for Kyiv amid Hungary’s continuing opposition to other packages from an off-budget fund called the European Peace Facility (EPF) worth more than €6 billion.
Each European Union member state has a veto on EPF payments and Hungary has been blocking some disbursements related to Ukraine for nearly a year. A €5 billion support fund is also blocked.
EU diplomats were not expecting a breakthrough on the EPF deadlock with Hungary. As a result, Ukraine military aid from the proceeds is a useful alternative means of support.

Borrell referred to this blockade from Hungary as a “structural difficulty” in a press conference after the EU foreign ministers meeting in Luxembourg.
EU member states first gave their approval to use the proceeds to buy arms for Ukraine in May however it was unclear when the first payments would flow because of Hungary’s veto.
A legal analysis noted that as Hungary abstained on the decision to use the frozen assets for Ukraine, and that the new aid is derived from the Russian Central Bank assets, and not EU funds, Budapest’s veto does not apply.
Borrell said due to Hungary’s abstention, “it’s not necessary” to involve Budapest in carrying out the decision.
Hungarian Foreign Minister Peter Szijjarto condemned the move as a violation of EU rules, according to Hungarian government spokesman Zoltan Kovacs on X, formerly Twitter.
Hungary opposes military aid for Ukraine fearing an escalation of the conflict with Russia and expresses doubts about Western support for Ukraine, preferring instead to call for a ceasefire.
However, Hungarian Prime Minister Viktor Orban has previously linked decisions on aid for Ukraine to freeing up EU funds for Hungary that have been frozen due to concerns about the rule of law.
The military aid for Ukraine uses the interest and other profits from the assets, but not the underlying assets themselves, which will remain frozen.

A total of 90 per cent of the money will fund military aid, while 10 per cent will go directly to Ukraine as financial aid.
Under the agreement, Germany and the Czech Republic have been selected as the first to use the proceeds to provide Ukraine with air defence equipment and artillery shells, EU diplomats said.
Other EU member states may administer the proceeds in the future.
According to the European Commission, around €210 billion worth of Russian Central Bank assets are frozen in the European Union.
The Brussels-based financial institution Euroclear, which holds the lion’s share of the assets, recently announced that the assets had made around €4.4 billion in interest in 2023.
EU foreign ministers also adopted new punitive measures to crack down on sanctions evasion and stop Russia from obtaining Western technology for making weapons.




A further 69 individuals and 47 entities linked to the Russian invasion of Ukraine have been sanctioned with an asset freeze and a travel ban to the EU.
EU sanctions also targeted organisations for providing services or goods used by the Russia military based in China, Turkey and India. No goods may be sold to these sanctioned companies from the EU.
The new salvo of sanctions target Russia’s multibillion-dollar liquefied natural gas (LNG) sector for the first time.
These punitive measures ban ports such as Zeebrugge in Belgium from shipping Russian LNG to countries outside the EU after a nine-month transition period.
Also targeted is Russian President Vladimir Putin’s so-called shadow fleet used to avoid sanctions including 27 specific vessels.
Another target was the Financial Messaging System of the Central Bank of Russia (SPFS). EU banks are to be banned from using the service which the bloc views as a Russian initiative to evade sanctions.
Media, non-governmental organisations (NGOs) and political parties are to be banned from accepting funding from the Russian state or other proxies.
German opposition to the 14th sanctions package needed to be overcome, EU diplomats said, as Berlin was concerned the package went too far, especially for subsidiaries.
EU diplomats said a compromise was reached, allowing measures halting exports to Russia – the so-called “No Russia” clause – to not apply to subsidiaries for the time being. The issue is to be revisited.


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European Union

EU ministers approve US$1.5 billion Ukraine military aid using Russian assets

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World

Russia & Central Asia

EU backs Russian frozen asset plan to aid Ukraine, sparking Hungarian anger


European Union governments agreed to use in profits from Russian frozen assets for arms and other aid to Ukraine, sparking Hungarian anger.
