(MENAFN) Belgian Prime Minister Bart De Wever has cautioned that an EU initiative to support a €140 billion loan for Ukraine using frozen Russian state assets could undermine the chances for a peace agreement and expose Belgium to significant legal risks.

In a “strongly-worded letter” on Thursday to EU Commission President Ursula von der Leyen, cited by a media outlet, De Wever criticized the plan—which proposes using the immobilized funds at Brussels-based Euroclear as collateral for a “reparations loan”—as “fundamentally wrong.”

He argued that the move would remove a crucial negotiating tool in any future discussions with Moscow.

“Hastily moving forward on the proposed reparations loan scheme would have, as a collateral damage, that we as the EU are effectively preventing reaching an eventual peace deal,” De Wever emphasized in his letter.

He further warned that Belgium could face claims for repayment if Russia later contests the action.

“In the very probable event Russia is ultimately not officially the losing party, it will… be legitimately asking for its sovereign assets to be returned,” De Wever wrote, noting that the scheme could also destabilize EU financial markets.

Meanwhile, several EU nations have reportedly accused Belgium of mismanaging tax revenue derived from the frozen Russian funds.

According to the media outlet, diplomats suggest that Brussels may have integrated the income from Euroclear into the national budget rather than allocating it transparently to Ukraine, contrary to previous assurances.

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