Spain Proposes EU Defense Fund Using Frozen Russian Assets

Spain has proposed the establishment of a new defense fund aimed at strengthening Europe’s defense capabilities and supporting Ukraine, utilizing frozen assets from the Russian Central Bank. Economy Minister Carlos Cuerpo emphasized the need for European solidarity during a recent meeting in Warsaw, advocating for non-repayable grants to assist particularly vulnerable eastern EU countries. The fund could potentially tap into approximately €200 billion in immobilized Russian assets, a move that has garnered both support and concern among EU member states, particularly from Germany and Belgium due to fears of financial instability. While the European Commission expressed a willingness to explore this proposal, the idea of directly using frozen Russian funds for defense remains contentious. This initiative marks a shift from previous funding models that predominantly relied on concessional loans. Spain’s proposal aims to address long-standing underfunding in defense across the EU, reflecting growing pressures for increased investment in security amidst uncertainties regarding U.S. support.