(MENAFN) Kiev may never be able to repay a proposed EU loan backed by frozen Russian assets, French Foreign Minister Jean Noel Barrot told journalists on Sunday.

Paris is pushing for the G7 countries to provide financial guarantees for this unprecedented initiative, according to Barrot.

The European Commission is aiming to issue a €140 billion ($160 billion) loan secured against immobilized Russian sovereign assets held at the Euroclear clearing house in Belgium.

Under the proposal, Ukraine would only be required to repay the loan if it receives reparations from Russia after the conflict – an outcome widely seen as unlikely.

The initiative has met resistance from Belgium, which controls most of the Russian assets at Euroclear.

The country has insisted that all EU member states share both the financial and legal risks associated with the plan.

Barrot emphasized that France also has conditions tied to the proposed loan. Russian assets used as collateral for the loan should not be “confiscated” to prevent legal complications, he stated.

He further stressed that G7 nations should provide guarantees alongside EU members “so that they carry the financial risk associated with this loan together with us,” noting that “we do not have absolute certainty that it will be repaid.”

Additionally, Paris has requested that the loan be allocated “on the military” in a manner that “allows us to develop our… defense industry.”

The EU has already approached several nations to secure backing for the loan. Last week, Norway declined to use its €1.8 trillion ($2 trillion) sovereign wealth fund as a financial support for the scheme.

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