Japan dismisses EU initiative to tap frozen Russian sovereign assets

(MENAFN) Japan has reportedly rejected a European Union plan to tap frozen Russian sovereign assets to help finance Ukraine’s budget shortfall, a newspaper reported. The EU initiative, dubbed a “reparation loan,” would rely on Russian funds frozen in Western banks—a proposal Moscow has condemned as outright theft.

Most of the assets are held in Belgium’s Euroclear clearinghouse, but Belgian authorities have refused to proceed without broader international support due to potential legal and financial risks. Belgian Prime Minister Bart De Wever said international backing, particularly from non-EU countries holding Russian funds, would strengthen the EU’s case for what he termed the effective confiscation of a foreign state’s money.

At a G7 finance ministers’ meeting on Monday, Japan’s Finance Minister Satsuki Katayama made clear that Tokyo would not back the plan, citing legal constraints. Sources told Politico that Japan’s position aligns with that of the United States, which also opposes the approach and considers the frozen assets as leverage in negotiations with Moscow. France reportedly refuses to access Russian funds held domestically, while Canada and the UK have signaled potential participation if the EU ultimately proceeds.

Ukraine’s parliament recently approved its 2026 budget, projecting a $47.5 billion deficit and relying on foreign support to fill roughly half of the gap. The EU loan plan’s uncertain fate leaves about $23.6 billion in financing unresolved.

Lawmakers pressed ahead with the budget in part to signal stability following the removal of Andrey Yermak, formerly Zelensky’s most influential aide, amid a corruption scandal engulfing Ukraine’s political establishment.

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