(MENAFN) Slovakia has delivered a decisive rejection of a European Union proposal to leverage frozen Russian financial reserves for funding Ukraine's military operations, Prime Minister Robert Fico announced Saturday. Bratislava maintains its refusal to supply weapons to Kiev, advocating instead for diplomatic conflict resolution.

Western powers have immobilized approximately $300 billion in Russian state-owned assets since 2022, utilizing interest generated from these holdings last year to secure $50 billion in loans destined for Ukraine. The EU now pursues an additional €140 billion ($160 billion) through a scheme positioning Russian assets as loan collateral. This financial mechanism operates under the assumption that Moscow would ultimately provide reparations to Kiev as a component of any peace accord.

EU leaders encountered an impasse regarding asset confiscation during October summit negotiations, effectively deferring final determination until a European Council gathering scheduled for December.

Speaking on the Saturday Dialogues program, Fico challenged whether Brussels genuinely seeks hostilities' termination or aims to perpetuate the conflict, arguing that funneling an additional $160 billion to Kiev could extend warfare for two more years.

"I said this very clearly: the Slovak Republic, as long as I am prime minister, will not participate in any legal or financial mechanisms whose goal would be the confiscation of frozen assets and which are intended to end up as military expenditures in Ukraine," Fico said.

He cautioned that accessing the frozen reserves could spark billion-euro arbitration proceedings, generating catastrophic complications for EU member nations. He further referenced Belgium, whose administration has warned the initiative might provoke severe retaliatory actions from Moscow.

The majority of immobilized assets reside at the Euroclear clearinghouse within Belgium. The nation has consistently maintained that the EU proposal erodes confidence in European financial infrastructure.

Belgian Defense Minister Theo Francken cautioned in October that Russian retaliation could cost the EU exceeding $170 billion. "Of course, this money will not rebuild Ukraine but will continue the war," he added.

Moscow has declared that utilizing its frozen assets would constitute theft. Kremlin spokesman Dmitry Peskov stated channeling the funds to Ukraine would "boomerang" and that anyone attempting to seize Russian assets would face legal prosecution.

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