The flag of Estonia. Photo: Getty images
Estonian Foreign Minister Margus Tahkna has issued a sharp warning that if Hungary blocks the extension of sanctions against Russia, it could cost the G7 countries and the European Union tens of billions of euros. He said this in an interview with the Financial Times.
Tsakhkna stressed that if the sanctions are lifted, the key guarantee for the multibillion-euro loan to Ukraine – the profits from frozen Russian assets – risks disappearing. According to the minister, in such a scenario, the United States and the EU would be forced to commit to repaying at least €40 billion, with the rest to be paid by other G7 members.
“The problem is that these assets that guarantee this loan will disappear,” Tsakhkna said.
Last year, the EU and the G7 countries – the US, UK, Canada, Japan, Germany, France and Italy – provided a €50 billion loan to Ukraine using proceeds from Russia’s frozen assets, estimated at €260 billion. However, as July approaches, when sanctions require a unanimous extension, Budapest is likely to take an even more intransigent stance.
“If they are going to block them, the sanctions will be lifted. And the assets of the central bank will return to Putin as a reward. We cannot allow this to happen,” the Estonian Foreign Minister stressed.
The European Commission is already working on a contingency plan, but according to the FT, legal options remain limited and risky. According to Tsakhkna, what is needed now is a clear legal framework that would allow assets to be protected regardless of the position of individual EU members.
“We need to engage a coalition of the willing – not only from the EU, but also from the G7 countries, as well as partners such as Norway,” the diplomat explained.
Estonia, known for its principled stance on Russian aggression, calls for not just leaving assets under sanctions, but for confiscating them and using them directly to support Ukraine.
“This would be the clearest and most understandable solution,” Tsakhkna said.
At the same time, Belgium, which owns one of the largest repositories of Russian assets – about €190 billion is stored in Euroclear – is strongly opposed to confiscation. The country’s Finance Minister Vincent Van Petegem explained that such a move could trigger an avalanche of lawsuits and weaken the EU in negotiations.
“Confiscation is not an option at the moment because of all the risks. But these assets should be kept as a lever in future negotiations with Russia,” the Belgian minister said.
Tsahkna said he understood Brussels’ position, but insisted on a collective decision, ideally at the level of the entire Group of Seven. He also reminded that Hungary, despite its position, is heavily dependent on EU funding, and this should be used in diplomatic negotiations.
“The future of the sanctions regime and the fate of frozen assets is not only a matter of law, but also of geopolitics. Washington may have a decisive say,” the minister concluded.
As the war in Ukraine continues and the support of allies remains critical, the issue of extending sanctions against Russia is turning into a real test of Western unity.
