A decisive week begins for Ukraine and Europe

The European Union is reaching a decisive moment in its involvement in the war in Ukraine. After months of hesitation, European leaders are attempting to agree on an unprecedented plan: to use Russian assets frozen in Europe to guarantee a large loan to support Ukraine's war effort and the functioning of the state over the next two years. The stakes go far beyond the financial issue, touching on Europe's geopolitical credibility and its ability to exert influence alongside the United States and Russia.

As Washington steps up its own diplomatic initiatives to end the conflict, often without fully involving the Europeans in the discussions, Brussels wants to demonstrate that it can act independently. The plan is to use around €210 billion of Russian assets frozen in Europe to guarantee up to €90 billion in zero-interest loans for Kiev. This sum would cover nearly two-thirds of Ukraine's estimated financial needs over two years. Repayment would only be required if Russia paid war reparations.

For European officials, this mechanism would make it possible to support Ukraine without placing further strain on already stretched national budgets. It would also give Europe significant political leverage in future negotiations on the future of the conflict. Several diplomats believe that without this massive financial commitment, the EU risks being marginalised in discussions between Washington and Moscow at a time when the continent's security architecture is at stake.

But this plan remains deeply controversial. Belgium, where most of the Russian assets in question are held, has expressed strong reservations. Brussels fears legal action, economic retaliation and a negative signal being sent to international investors. Other Member States, such as Bulgaria, Italy and Malta, share these concerns and are calling for alternative solutions that are considered less risky.

The fears relate in particular to Europe's financial attractiveness. The idea that a bloc could mobilise frozen sovereign assets to finance a third party raises questions of legal certainty. Some experts fear that foreign investors will be reluctant to place their funds in Europe if they perceive this to be a dangerous precedent. These doubts explain the difficulty in reaching a clear consensus, despite the apparent urgency.

Russia, for its part, is attempting to block the process. The Russian Central Bank has taken legal action against the Belgian depositary that holds a large portion of the funds. This legal offensive is increasing pressure on Belgium, which is calling for risk sharing with other European countries, particularly those holding smaller amounts of Russian assets.

In the background, the American position further complicates the debate. Proposals from Washington suggest the possibility of a partial thawing of Russian assets as part of a future peace agreement, or even their joint use in Russian-American projects. This prospect has been rejected by European capitals, which want to prove their ability to act alone in support of Kiev.

For many European leaders, the failure of this plan would be seen as an admission of political and moral impotence. Conversely, an agreement would mark a turning point, underlining that Europe is prepared to take risks to defend its security and its role on the international stage. The New York Times

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IN SHORT
🇱🇧 Lebanon • Two Israeli strikes targeted two vehicles in Lebanon today, south of Beirut and near the Israeli border, killing two people according to the Lebanese Ministry of Health. The Israeli army claims to have targeted two "Hezbollah terrorists" accused of seeking to rearm since the November 2024 ceasefire. A van was hit near Sibline, killing one person and injuring four others. Another strike hit a car in Odaisseh, causing one death. Israel continues its strikes regularly despite the "truce".

🇺🇸 United States • US forces carried out new strikes against three boats in the Pacific Ocean suspected of being linked to drug trafficking, killing eight people according to the US Southern Command. Washington claims that the boats were travelling along known drug trafficking routes, without publishing any evidence. Since September, the United States has targeted at least 26 ships in the Caribbean and the eastern Pacific, killing 95 people. Experts, NGOs and the UN are questioning the legality of these strikes in international waters, denouncing the excessive use of lethal force.

🇫🇷 France - 🇪🇺 European Union • Paris is hardening its position on the free trade agreement between the European Union and Mercosur, with Emmanuel Macron calling for a postponement of its review despite the concessions announced by the European Commission. France considers the agricultural, health and environmental guarantees to be insufficient, refuses to comment on mere announcements, and accepts the risk of isolation within the EU-27. Germany and Spain are pushing for a quick signature, in the face of opposition from the United States and China. Rome now occupies a pivotal position, likely to provide Paris with a blocking minority.

🇦🇺 Australia • After the attack in Sydney, Australian police are focusing on the possibility of a terrorist attack inspired by the Islamic State. Jihadist flags were found in the vehicle of the two attackers, a father and son, who were responsible for an anti-Semitic shooting that left 15 people dead on Bondi Beach during the Hanukkah holiday.

🇨🇳 China • Beijing has decided to limit customs duties on pork imports from the European Union, with taxes ranging from 4.9% to 19.8%, for an average rate of 9.8% applied in particular to French exports. This decision ends an anti-dumping investigation launched in 2024, against a backdrop of trade tensions with Brussels. For European producers, the reduction from the provisional 20% tariffs is a partial relief.

🇪🇺 European Union • The European Union has decided not to impose an all-electric requirement for new cars in 2035 and will allow a limited number of combustion engine and hybrid vehicles after that date. The European Commission is taking a pragmatic approach in view of the difficulties faced by manufacturers and the still limited uptake by consumers. Manufacturers will have to reduce CO2 emissions by 90% compared to 2021 and offset the remaining emissions. Brussels is promising a carbon-free sector by 2035, while supporting batteries, company fleets and European industrial preference.

🇦🇲 Armenia – 🇦🇿 Azerbaijan • In the coming days, Yerevan will receive its first delivery of petroleum products from Baku in more than 30 years, a concrete sign of normalisation after the past wars and the exodus from Nagorno-Karabakh. The transit will pass through Georgia, which has agreed to a first free passage, while the direct borders remain closed. For Armenia, which is highly dependent on Russian fuel, the stakes are economic and political, in a context of deteriorating relations with Moscow.

🇺🇸 United States • Donald Trump's chief of staff, Susie Wiles, claims that the US president has "the personality of an alcoholic", even though he does not drink alcohol. She describes a leader who is convinced that there are no limits to what he can do. These comments, made in interviews with Vanity Fair magazine, have sparked strong reactions in Washington. Susie Wiles subsequently denounced the portrait as "dishonest", and the White House and several Republican officials publicly defended her.

🇺🇸 United States • Donald Trump has filed a lawsuit against the BBC, seeking up to $10 billion for editing an excerpt from his 6 January 2021 speech broadcast on the Panorama programme. The president accuses the British public broadcaster of splicing together passages spoken an hour apart to make him appear to be calling for a march on the Capitol and to "fight." The BBC acknowledges an editorial error and has apologised, while denying any defamation. The lawsuit, filed in Florida, is one of a series of lawsuits Trump has brought against the media since returning to power.

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