The European Union is poised to tackle the complex issue of defence spending at an upcoming summit this week. Central to these discussions is the potential relaxation of rules surrounding the use of approximately $350 billion in frozen Russian assets. With tensions between the UK and France at the forefront, the proposal to utilize these assets for purchasing US defence equipment is both a strategic maneuver to bind America closer to Europe’s defence and a contentious topic among EU members.
The urgency to resolve this matter has escalated as Europe seeks strategies to prevent former President Donald Trump from withdrawing US support for Ukraine. An estimated $240 billion of these frozen Russian assets reside within the EU, with the UK holding between $28 billion to $30 billion, while the remainder is distributed globally. The proposition to channel a significant portion of these funds into the US defence industry aims to incentivize Trump to maintain support, a move supported by several EU nations including the Czech Republic, Estonia, and Poland.
However, disagreement abounds within the EU regarding the feasibility and implications of such a proposal. Emmanuel Macron, President of France, has been vocal about ending Europe’s reliance on US weaponry, a position reinforced by Trump’s approach to Ukraine. Macron has emphasized increasing defence spending within NATO to 3.5% of GDP, sourcing funds from unused EU cohesion funds, joint defence bonds, or national spending increases. His opposition to seizing these assets stems from concerns about violating the principle of sovereign immunity, which could deter investment in the eurozone from nations like Saudi Arabia and China.
"We have $250bn frozen Russian assets in Europe, but this does not belong to us so they are frozen. If at the end of the day in the negotiation we would have with Russia, they are ready to give it to us, super." – Emmanuel Macron
The UK, on the other hand, has shown a long-standing willingness to seize these assets. This position has grown more pronounced recently, with strong support from UK Foreign Secretary David Lammy. Former UK National Security Adviser Lord Ricketts suggested that tensions between France and the UK could be mitigated by redirecting the assets to aid Ukraine directly—a proposal also backed by Ukrainian President Volodymyr Zelenskyy. Both France and the UK agree that a US security guarantee is essential before committing peacekeeping forces to Ukraine.
France’s frustration with EU countries' defence spending is palpable; since the conflict began, only 22% of military equipment orders have been placed within Europe, with the majority sourced from the US. This reliance underscores Macron’s argument for a robust European defence industry independent of US support.
"Russia’s brutal assault on Ukraine has so violated the principle of ‘sovereign equality’- that all states have a duty to respect the territorial integrity and political independence of other states – that it is hard to see how this concept can be invoked to stop these assets from being seized.” – David Cameron
The debate over seizing Russian assets is fueled by differing opinions on whether such a move would indeed persuade Trump and whether it aligns with Europe’s long-term strategic goals. Critics argue that it might undermine efforts to foster a self-sustaining European defence sector.