EUROPE is breathing a sigh of relief. On December 2nd Donald Trump’s envoy, Steve Witkoff, held lengthy talks about Ukraine with Vladimir Putin in Moscow—and not much happened. Many had been expecting Team Trump to sell out Ukrainian sovereignty in return for commercial deals. The risk of such an odious stitch-up now seems to have receded a bit. Thanks to pressure from European leaders and some sensible Republicans, including the secretary of state, Marco Rubio, some of the worst elements of a 28-point plan hatched by Mr Witkoff and his Kremlin chum, Kirill Dmitriev, have quietly been dropped. Mr Putin seems unenthusiastic about the current version. Mr Trump now says the whole thing is “a mess”. Diplomacy, like the war, will grind on.
But if European governments think they are off the hook, they are wrong. First, another bad pseudo-peace plan could pop up. Second, even if it doesn’t, Ukraine will need solid military and financial support for the foreseeable future, and it will have to come from Europe. It is still not clear that Europeans grasp this.
When Mr Putin launched his full-scale, unprovoked invasion, Europe did the right thing. The EU and others imposed stiff sanctions on Russia and gave military and financial aid to Ukraine, roughly matching the level of support from America. But that united front depended on the White House agreeing that territorial aggression should not be rewarded. Mr Trump has blown that consensus apart. Now, the $90bn-100bn it costs each year to support Ukraine’s war effort, a burden previously divided evenly, must be shouldered by Europe alone. As our calculations earlier this year showed, it is a large sum in aggregate but a small price to pay for Europe’s security. The annual GDP of the EU alone is nearly $20trn.
Russia may be advancing on the battlefield, but only slowly and at a huge cost in men and money. So Europe faces three strategic tasks. First, to make Mr Putin realise he cannot win, by convincing him that Europe (which has an economy ten times larger than Russia’s) will never abandon Ukraine. Second, to reassure Ukraine. Third, to show the MAGA crew that Europe is not the feeble, freeriding bloc they say it is. On all three, Europe is coming up short.
Nothing illustrates this better than an EU squabble over some €210bn ($245bn) of frozen Russian assets, much of it lodged at a clearing-house in Brussels. The G7 agreed last year to use the interest generated by the invader’s frozen assets to support its victim. But this is not enough. An EU summit in October was supposed to agree on a more creative way to mobilise the assets, using some of them to back a “reparations loan” to Ukraine, which would be repaid only if Russia pays compensation for the harm it has inflicted. Belgium wants other European countries to share the risk that Russia might sue to retrieve its assets. A deal ought to be possible, but so far all proposals, including a complex one from the commission this week, have failed to win assent.
If Europe will not, or cannot, deploy the frozen assets, it must use its own balance-sheet—soon. That means common borrowing: Eurobonds, strategic-autonomy bonds, whatever label is politically palatable. Ukraine needs predictable, multi-year financing: a four- or five-year package it can count on to keep its budget afloat, manufacture shells and rebuild power plants. Europe’s current dribs-and-drabs approach is the opposite of strategic. It forces Ukraine to live from one donor meeting to the next; it encourages Mr Putin to wait the West out; and it offers ammunition to those in Mr Trump’s inner circle who argue that Europe is incapable of serious statecraft. ■
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