Europe has provided nearly $122 billion in aid to Ukraine but remains reluctant to confiscate $229 billion in frozen Russian central bank assets. While the EU is using the interest from these funds to support Ukraine through loans, seizing the principal amount is seen as legally and economically risky.

Concerns include potential damage to Europe’s reputation as a secure financial hub and the risk of discouraging foreign investments, especially from countries like China. Additionally, international law protects state assets from seizure, making outright confiscation legally complex.

While the U.S. and Canada have passed legislation allowing asset confiscation, European nations remain divided. France recently passed a non-binding resolution supporting the use of frozen Russian assets for Ukraine’s defense and reconstruction. However, key EU nations, such as Belgium and Germany, remain cautious.

A unanimous decision among EU members is required for such a move, which is unlikely given Hungary and Slovakia’s pro-Russia stance. Some officials also fear that confiscating these funds could hinder future peace negotiations. For now, the frozen Russian assets remain untouched, leaving European taxpayers to bear the cost of supporting Ukraine.