On July 10, 2025, a powerful statement echoed from Rome. Speaking at the Ukraine Recovery Conference, German Chancellor Friedrich Merz declared that Russia must compensate for the damage caused by the conflict—and until that happens, Moscow will not gain access to its frozen central bank assets.
The compensation demand is striking—around €500 billion. This is the amount the German government estimates as Ukraine’s material losses since the onset of the full-scale invasion. Merz made his remarks against the backdrop of ongoing debate about the fate of approximately $300 billion in frozen Russian assets. The bulk of these funds—about $200 billion—are held within the European Union, primarily in Belgium, through the Euroclear financial clearing system.
Merz’s speech was more than a financial position; it was a clear political signal. The message: support from international partners will not be enough. Real recovery must be financed, at least in part, by the country deemed responsible for the destruction.
“The material damage must be compensated by those who caused it,” Merz stated, adding that Germany has no intention of backing down. While the G7 recently agreed on a $50 billion loan to Ukraine—secured by interest generated from the frozen assets—Merz emphasized that this is only a starting point. Annual earnings from the frozen reserves are expected to generate between €2.5 to €3.5 billion, which falls short of what’s needed for full reconstruction.
Beyond the financial aspect, the chancellor also addressed Ukraine’s urgent defense needs. He called for accelerated delivery of advanced air defense systems, including Patriot missile systems, to help shield Ukrainian cities from ongoing missile attacks. According to Merz, long-term recovery will be impossible without improving security on the ground.
The Rome conference brought together representatives from over 60 countries and international organizations to coordinate efforts in rebuilding Ukraine, delivering humanitarian aid, and ensuring economic stability. The World Bank presented an updated report estimating Ukraine’s total infrastructure damage has now surpassed $600 billion.
Merz’s address can be seen as a firm signal that there will be no compromise on accountability. Financial measures being implemented across Europe and beyond are not just about pressure—they are part of a broader framework aimed at restoring justice, as seen by the nations shaping the future of the region.
In this light, Russia’s frozen assets will remain locked, as calls grow louder for turning these funds into direct instruments for reparations and rebuilding.
