Politico: EU fears Belgium's veto will jeopardize IMF loan to Ukraine

Belgium's refusal to back a €140 billion 'reparations loan' to Ukraine could jeopardize the International Monetary Fund's new loan program, EU sources told Politico.

"This is not something to play around with," said the EU official, who, like other Politico spokespeople, agreed to speak candidly only on condition of anonymity .

One European Commission official and diplomats from three member states said the "reparations loan" would convince the IMF of Ukraine's financial viability in the coming years, a prerequisite for any state to agree to finance it.

Although the IMF program for Ukraine is relatively small (about $8 billion), its approval sends a signal to investors that the country is financially viable and committed to reforms.

"We are facing a problem of timing," the EU official emphasized, pointing out that the next summit of EU leaders is scheduled for December 18-19 only.

During the previous summit, EU leaders removed the mention of a loan to Ukraine from the official conclusions of the EU Council as a concession to Belgium and left only a vague text without specific commitments that the European Commission is invited to provide financial support options as soon as possible based on an assessment of Ukraine's financial needs.

Such vague wording is unlikely to satisfy IMF's concerns about Ukraine's finances, EU official and two EU diplomats say.

• The idea of a "reparations loan" of up to 140 billion euros, based on the cash balances of Russia's frozen assets, was put forward on September 10.
• Thanks to the "reparations loan," Ukraine could receive 45 billion euros annually for the next three years - from 2026 to 2028, said Polish Deputy Foreign Minister Ignacy Nemczycki.
• On October 23, , the EU postponed the decision on a "reparations loan" for Ukraine at the expense of Russian assets until December.