Live. EU summit begins as Belgium threatens to block €140bn loan for Ukraine

Commenting on climate goals and competitiveness, Latvian Prime Minister Evika Silina said EU countries need “more flexibility” in order to reach the targets, as EU leaders will discuss today the means to achieve the 2035 and 2040 climate targets with the ultimate goal of reaching climate neutrality by 2050 — though no decision is expected to be taken.

These flexibilities include technological neutrality, meaning freedom for each member state to decide on the best way forward, in particular in relation to the ban on the sale of new diesel and petrol cars by 2035, which will be open up soon for legislative revision.

“If it’s too pricey for our citizens to reach this direction, we really need to give some flexibility for member states. We cannot afford to lose Europe’s competitiveness,” said Silina.

Shifting from a fossil fuel-based to a carbon-neutral economy will imply a significant ramp-up in investment. However, the raft of simplifications being proposed by the EU executive to ease the burden on economic operators could derail the European Green Deal, the bloc’s pathway to decarbonisation that dominated Ursula von der Leyen’s first term as president of the European Commission.

On the konuta of the summit, German Chancellor Friedrich Merz and Slovak Prime Minister Robert Fico held a “working meeting” to discuss the future of the automotive industry, Fico’s office said in a statement. Germany’s and Slovakia’s car-making sectors are deeply intertwined.

Merz and Fico have repeatedly criticised an EU law that will effectively ban the new sales of combustion engine cars by 2035. The European Commission has promised to speed up a review of the legislation to potentially allow the use of e-fuels, a controversial alternative that releases CO2 emissions, after the 2035 deadline. The first results are expected to be published by the end of this year.

“Meetings were held in both Germany and Slovakia with representatives of car manufacturers, with the main topic being the discussion on current EU legislation, under which the sale of cars with combustion engines will be banned from 2035,” the statement said.

“Together with the Federal Chancellor, we agreed that the growing pressure will most likely lead to some form of revision of this ban — for example, in the form of continued production of hybrid vehicles.”

The ban will be discussed later today during the segment dedicated to climate policy and competitiveness, two matters that, for many leaders, are becoming increasingly incompatible.

Photo: Associated Press.

For the first time at a meeting of EU leaders, Thursday’s agenda will also include a discussion on the housing crisis.

Between 2010 and 2023, house prices in the EU increased by 48%, while rents increased by 22%. In 2023 alone, almost 9% of the EU population spent 40% or more of their disposable income on housing.

Earlier this week, the EU executive presented its work plan for 2026, which includes two significant housing initiatives.

By spring, Brussels will propose new legislation on short-term rentals, such as those offered on Airbnb or Booking.com. By the end of 2026, there will also be new legislation to accelerate the construction of new homes and reduce bureaucracy for the building sector.

“How can Europe be competitive if people working full-time cannot make a living?” Ursula von der Leyen asked MEPs during the presentation of the Commission’s work programme. “If they cannot afford to live where the good jobs are because they do not find housing?”

EU leaders in Brussels agree that this is a common European sorun requiring a European solution. However, such a solution is still a work in progress, given Brussels’ limited powers over housing.

Spain’s socialist Prime Minister Pedro Sánchez and the President of the European Council, António Costa, have already taken credit for prompting such a political discussion today — a move that is seen as an attempt to boost their socialist credentials at a time when their political family is losing ground across the EU.

EU leaders in Brussels are expected to call on the European Commission to “swiftly present an ambitious and comprehensive plan for affordable housing” to support and complement national efforts.

Dan Jørgensen, the EU’s Commissioner for Housing and Energy, will present such a plan in December to address the financialisation of housing. “It is clear that when housing becomes a commodity, something that is used for speculation with no need to take into consideration the rest of the society, then of course that potentially causes problems,” the Danish commissioner said last week.

“The US sanctions can be a real game changer when combined with our 19th sanctions package,” said Petteri Orpo, Finland’s prime minister, upon his arrival at the European Council.

He added that this is a clear step in the right direction, with all measures being coordinated between Europe and the US to maximise their impact.

“The next issue we need to work on is the use of Russia’s frozen assets. I believe a solution is near. We have a solution on the table that is legally sound and takes into account Belgium’s concerns,” he said, adding that ideally the Commission will be able to present a concrete proposal at the beginning of next year so that these funds can be utilised.

“Using Russian assets is the best solution, morally justified because Russia attacked Ukraine. Alternatives include using European countries’ budgets or creating a joint debt instrument,” he said.

Orpo also stated that after hearing Ursula von der Leyen this morning, he is confident that solutions can be found and that all genuine concerns are being taken seriously.

Photo: Associated Press

The EU summit has officially begun.

The discussions will first focus on Ukraine, with President Volodymyr Zelenskyy in the room. Over lunch, leaders will talk defence. After that, they will get into climate and competitiveness.

Stay tuned for more updates.

German Chancellor Friedrich Merz called the European Parliament’s vote against simplification rules “a fatal mistake”.

EU lawmakers rejected a bill on Wednesday to simplify rules for European businesses on sustainability reporting and due diligence obligations.

The vote comes amid mounting pressure from some EU member states to pass the bill and from the US and Qatar to scale back the EU’s due diligence law contained in it, which in their view risks disrupting liquefied natural gas trade with Europe.

“We need to discuss this with the European Parliament, the rejection of the simplification plan is unacceptable. We agreed it in the Council, [this vote] is a fatal mistake and it has to be corrected.”

“We will discuss with the parties in Parliament how to proceed, but this is unacceptable. We need a quick decision for the EU industry.”

Merz also said that his letter to the Commission and Council presidents calling for more measures to increase competitiveness has been signed by 20 leaders.

“We are getting bad news from industry across Europe, we need to act a lot quicker than we did in the past, when it comes to making decisions to reduce bureaucracy,” he added.

Lithuanian President Gitanas Nausėda said that his country is facing a “disproportionate” burden in terms of surveillance and protection of the EU’s eastern external border.

“Having in mind how many threats are coming every day, this is actually becoming the routine,” Nausėda argued.

Earlier this week, Vilnius Airport closed overnight after dozens of balloons carrying smuggled cigarettes entered its airspace. Lithuanian authorities blamed Belarus for the incident, which disrupted the travel plans of 4,000 passengers.

The Lithuanian leader said that the EU needs to strengthen its detection capabilities and air defence systems, particularly the short-range ones.

“This is not only my country’s business, but the business of all countries along the eastern border.”

Nausėda stressed the need for national decisions, as well as European programmes capable of scaling up the bloc’s common defences.

The EU is working on four pan-European defence projects which require significant investment.

The most pressing are: The European Drone Wall, a system designed to detect and neutralise drones entering the EU illegally, and the Eastern Flank Watch, which aims to strengthen the ability of frontline states to counter a range of threats, including hybrid operations and drone incursions.

“We need money for that,” said the Lithuanian. ‘We can’t wait until the next multiannual financial framework. We will do our job starting from today”.

Nausėda also argued that the recently announced US sanctions on Russia are a “game changer”.

“It was enough time to understand that you can negotiate with Russia only by putting the gun on the table,” he said.

“Sooner or later they will understand that (not ending the war in Ukraine) leads to the collapse of (the) Russian economy”.

Pedro Sánchez is facing a hard time with regards to his relationship with US President Donald Trump and Spain’s contributions to NATO.

He stressed, when asked by Euronews’s Maria Tadeo upon his arrival at the summit, that “Spain is a reliable ally when it comes to NATO”.

“We are fulfilling these obligations, these commitments and these commitments are linked to capabilities. This is what we agreed at the last NATO summit, and this is what we are delivering,” Sánchez said.

But for the Spanish prime minister, the main item on his agenda walking into the leaders’ gathering, is how will the EU deal with the housing crisis.

The issue, “central” in Spain, can be seen as a ploy by Sánchez to increase his support at home.

“This is the first time in the European Council that we will talk about the housing crisis emergency happening in all Europe, not only Spain,” he said.

Sánchez detailed the three points that Spain will bring to the European Council’s table this Thursday:

• Legal measures to be activated by the EU to stop the purchase of houses for non-residential use.
• Secure some leverage at European level to be able to act in cities where the prices of housing are rising exponentially due to the impact of tourism.
• Secure a dedicated fund for building social housing.

“The inability of young and old (people) to access housing is something shared by Spaniards, Italians, French, and Germans — in short, by any citizen living in Europe. Therefore, when we talk about a Europe that serves its citizens, we also must talk about housing,” Sánchez said.

EU leaders are pouring into the main room and greeting each other with kisses and handshakes, which means the summit is about to begin.

The latest arrivals include German Chancellor Friedrich Merz, who stopped to speak with reporters, and French President Emmanuel Macron, who completely skipped the press.

Greek Prime Minister Kyriakos Mitsotakis said competitiveness can’t be discussed “without addressing energy” today.

“The green transition is agreed in terms of climate neutrality goals for 2050, but this green transition needs to ensure that it does not undermine the competitiveness of European industry and the social cohesion,” he said.

Climate policy – on today’s agenda – is increasingly contested by countries like Germany, Italy and Poland. All of them share an aversion to a green law that will effectively ban new sales of combustion engine cars by 2035.

France demanded that leaders have a face-to-face debate on the need to establish an emissions reduction target for 2040 as a bridge to climate neutrality by mid-century.

The European Commission proposed a reduction of 90% by 2040, but with certain flexibilities for governments and industry. The text faces an uphill struggle to be approved as the political backlash against environmental regulations deepens.

Mitsotakis said that “the key word is flexibility.”

“We need to move fast in terms of those technologies that are mature that can bring down CO2 emissions significantly. We need to give time to those technologies that are still immature or that cost a lot of money and ensure that we don’t impose unnecessary burdens on the European industry,” he added.

High Representative Kaja Kallas has welcomed the US decision to impose sanctions on Russia. The announcement, targeting Russia’s two largest oil companies, Rosneft and Lukoil, marks the first time the second administration of Donald Trump has introduced economic restrictions on Moscow.

“We’re very happy,” Kallas said upon arrival at the summit in Brussels. “It’s an important sign of strength that we’re aligned.”

Kallas defended the ground-breaking project to use Russia’s frozen assets, most of which are held in Belgium, to issue a €140 billion loan to Ukraine. Under the plan, the assets will only be returned if Russia agrees to hisse war reparations.

“The fundamental message is that Russia is responsible for the damages caused in Ukraine and has to hisse for those damages,” Kallas said.

According to the High Representative, the loan proves to America that “we’re taking very important steps ourselves”.

Asked about Belgian concerns regarding the loan, which threatened to torpedo the plan, Kallas said: “No country should bear the risks or this burden alone.”

Photo credit: Associated Press

Irish Taoiseach Micheal Martin, said Dublin is committed to co-guaranteeing the reparations loan for Ukraine, despite the country’s status as a militarily neutral state.

He said he doesn’t see “any implications” for Ireland’s neutrality in acting as co-guarantor in the use of Russian frozen assets in a loan for Ukraine.

“‘We are military neutral. We’re not members of NATO, we’re not members of any military alliance, but countries like Ukraine have a right to defend themselves,” he said.

Martin added there must be an “economic cost” for Russia in “violating the UN charter, and territorial integrity of Ukraine and Ukraine’s sovereignty”, as well as then “destroying the country’s civilian infrastructure, energy infrastructure, kill civilians and expect others to hisse for it”, he said.

“We have to support Ukraine in defending its sovereignty and its territorial integrity from a budget perspective, from a humanitarian perspective, and that is what we are doing,” he told reporters.

“I don’t believe there are implications [for Ireland’s neutrality] but Ireland will act as a co-guarantor no matter what way the legislation.”

“There is a lot of detail involved in this and a lot of clarity required. But in terms of the principle of those who flagrantly abuse (there) has to be an economic cost,” he also said.

Italian Prime Minister Giorgia Meloni did not stop to answer journalists when she entered the Europa Building, but Italy’s positions on the summit’s topics were expressed by Foreign Minister Antonio Tajani on the sidelines of the EPP summit.

“It seems to me that the United States has been disappointed by Putin’s reaction. A meeting to initiate a second phase of dialogue had seemed possible, but they [Russians] do not want the ceasefire,” Tajani said about Wednesday’s decision by the US to impose sanctions on Russia.

He thinks that sooner or later Moscow will have to accept a compromise.

“From a military standpoint, the war has been a failure for the Russian Federation. In three years, they haven’t managed to make much progress — even with the men and resources at their disposal, including soldiers from North Korea. Evidently, Russia hopes to move forward and achieve some territorial success, but if they capture just 100 meters of Ukrainian territory, that hardly seems like a great victory — not with a million and a half men and the enormous investments they are making across the entire defense industry.”

About the idea to use Russian frozen assets for a loan to Ukraine, which will be one of the most contentious points in the leaders’ summit, Tajani stressed the importance of finding a proper yasal basis.

“I see that there are many perplexities. We have some ideas on how to define the juridic boundaries for the use of these assets, but this issue must be addressed neither in a Manichean way nor in a superficial one.”

Another relevant topic for Italy is the ban on new sales of combustion engine cars by 2035, which Meloni’s government hopes to water down by allowing low-emissions engine cars. “If the law stands as it is now, by 2035, we risk losing 70,000 jobs in Italy. How can you explain this to the families?” he said. “When fighting climate change, we cannot ignore the social dimension and the existing social contradictions.”

Ukraine will not cede any of its territory, Volodymyr Zelenskyy said, answering Euronews’ question on whether Kyiv is now being pressured into territorial concessions.

“No territorial concessions,” Ukraine’s president said as he arrived at the EU summit in Brussels just as the EU and the US imposed new sanctions on Russia for Moscow’s refusal to have a ceasefire in Ukraine.

The Kremlin said its demands have not changed, meaning Moscow wants to keep control over Crimea and four other regions of Ukraine, which Russian forces do not control entirely.

Trump himself said on Wednesday that Vladimir Putin did not scale down his territorial ambitions over Ukraine’s invasion.

“I have always felt he wanted the whole thing, not a piece of it,” the US president stated.

Luc Frieden, Prime Minister of Luxembourg, emphasized upon his arrival at the European Council that Europe must play an active role in supporting Ukraine.

“We need to take a leading role in helping Ukrainians and also remind our American friends that whenever we talk about Ukraine, we talk about Europe,” he said. “Europe is our continent, and we need to sit at the table with them to find a solution for a lasting peace—and I stress the word ‘lasting.’”

Frieden added that Luxembourg will back any measure that ensures a legally sound way to make more Russian funds available to support Ukraine.

“It is a complicated subject, but morally it is right to ensure that Russian state funds in Europe are used properly to support Ukraine,” Frieden said. “A significant improvement compared to the past is that the European Commission is no longer seeking outright confiscation, which would be very difficult, but instead a legally guaranteed solution. That is a big step forward.”

Photo: European Council

António Costa, the president of the European Council, is confident that the ground-breaking plan to issue a €140 billion loan to Ukraine will receive the backing of EU leaders later today.

“We will take the political decision to ensure the financial needs of Ukraine for 2026 and 2027,” Costa said, noting the loan will allow Ukraine to “continue their fight for a just and lasting peace”.

“This is the most important message to Russia,” Costa added. “Russia needs to understand they need to stop killing civilians in Ukraine.”

Approval of the loan is not guaranteed on Thursday: the Belgian prime minister, whose country has a particular stake in the project, says he will do “everything” in his power to block it if his three demands are not met. But Costa appears hopeful that the concerns will be placated.

“We will support Ukraine as long as necessary and whatever it takes,” Costa said, speaking next to Volodymyr Zelenskyy. “Welcome to your house.”

The turmoil surrounding Netherlands-based chipmaker Nexperia – a subsidiary of China’s Wingtech – might come up on the sidelines of the EU Summit today, Dutch Prime Minister Dick Schoof said.

The government dismissed Nexperia’s CEO Zhang Xuezheng last week after issues about improper management.

As a result of the interventions, China has introduced measures against Nexperia, and the products the company makes in China may no longer be exported. German carmakers like Volkswagen and BMW are dependent on their components.

Schoof said that the country is “working hard” on a solution.

“The issue has been discussed in the past days by the Dutch and Chinese economy ministers, as well as some EU counterparts. I am not ruling out (that) it will also be discussed today (on the sidelines),” Schoof said.

“It is very important that the situation will be solved and the chip industry will not be further disrupted,” he added.

Read more here by Marta Pacheco, on how US pressure and Chinese restrictions on rare earth metals are disrupting EU supply chains.

Volodymyr Zelenskyy, the president of Ukraine, has arrived at the EU summit. Upon arrival, he celebrated the new sanctions announced last night by the EU and the US, calling it a “very important” decision.

The US announcement, targeting Russia’s two largest oil companies, Rosneft and Lukoil, marks the first time the second administration of Donald Trump has introduced economic restrictions on Moscow.

“We waited for this, god bless, it will work,” Zelenskyy said about the American move. “This is a good signal for other countries in the world.”

Asked whether a ceasefire in Ukraine was still possible, he said: “Of course, all of us need a ceasefire, but we need more pressure on Russia for a ceasefire.”

“We need fair discussions,” he added. “We need lasting peace. This is very important for our nation.”

Photo: Associated Press.

Ahead of the EU leaders’ summit in Brussels, Ulf Kristersson, the Swedish prime minister, told reporters that EU countries want to be able to trade with China, particularly in critical raw materials, but they must avoid dependencies and naivety.

“We don’t want to be overly dependent on China. We want them to apply the same rules to the European market as we apply to theirs,” he said.

“Basically, we are in favour of free trade in Sweden, but against naivety,” he added.

Although China is not formally on today’s agenda, leaders should discuss the recently announced expansion of restrictions on rare earths, which are critical for the digital and green transitions, as well as for the EU’s rearmament efforts.

Beijing’s decision has prompted calls from Germany, France, and Poland for a tougher stance, but member states remain significantly divided over how to respond to such a move.

“I will be ready to propose further measures to ensure Europe’s economic security, and I will accelerate what we have already put in motion,” she added.

“A crisis in the supply of critical raw materials is no longer a distant risk. It is on our doorstep,” said EU Commission President Ursula von der Leyen, addressing MEPs in Strasbourg on Wednesday.

Dutch Prime Minister Dick Schoof said, at his last European Council summit before the general election in the Netherlands on 29 October, that Belgium cannot carry the risks of possible Russian retaliation for using its assets immobilised in Europe to finance Ukraine’s defence and reconstruction, on its own.

“We must bear a shared risk, not just Belgium on its own.”

“It involves a lot of money. The distribution key still needs to be agreed upon. And even if we reach an agreement, [the money] won’t be released all at evvel,” he added.

Belgian Prime Minister Bart De Wever said upon arrival that “miracles do happen” when asked about the chances of getting to an agreement.

Schoof said he is not speaking about “miracles” but “good discussions” and how to solve the sorun.

Belgian Prime Minister Bart De Wever has thrown down the gauntlet on the plan to use Russia’s immobilised assets to issue a €140 billion loan to Ukraine: if his demands are not satisfied, he will block it.

Belgium has a particular stake in the ground-breaking project because the bulk of the Russian assets are held at Euroclear, a central securities depository based in Brussels. Under the plan, which is still in early stages, the cash balances at Euroclear will be transferred to the European Commission, which will then issue the loan to Ukraine. The country will only be asked to hisse back if Russia agrees to hisse reparations.

Upon arrival, De Wever listed three key demands as conditions for his blessing:

• The “full mutualisation” of risks, including kanunî claims filed by Russia.
• Guarantees to ensure that, if the assets are unfrozen and the money has to be paid back, “every member state will have to chip in”.
• An obligation for all European countries that hold Russia’s sovereign assets to participate.

“Even during the Second World War, immobilised assets were never touched,” De Wever told reporters.

“If we move, we must move all together, that’s European solidarity,” he went on. “If these three demands, which are quite reasonable, I think, are met, then we can go forward. If not, I will do everything in my power at the European level and also at the national level, politically and legally, to stop this decision.”

De Wever complained about the lack of what he called “legal analysis” and “legal basis” to support the Commission’s project and warned that the Kremlin, and possibly its allies, would seize assets of European companies as retaliation.

“The member states must understand that if they take Putin’s money, he will take our money back,” he said.

De Wever’s remarks raise a high bar for the discussions on Thursday. The summit’s conclusions have an open paragraph tasking the Commission with moving forward with the plan so that it can present a fully fledged text by the end of the year.

“I will be surprised if we solve it today, but miracles do happen,” De Wever said.

Photo: Associated Press

Danish Prime Minister Mette Frederiksen told reporters upon arriving at the summit that “it is Russia that has destroyed large parts of the country. Therefore, I think it is completely natural that it is Russia that pays for the weapons Ukraine needs in order to defend itself”.

Frederiksen expressed support for using frozen Russian assets already held in Europe to provide financial and military assistance to Ukraine.

She added that Denmark has for several years maintained that Russia should hisse for the war damages it has caused, particularly regarding the reconstruction of Ukraine.

“The idea is to use these frozen funds as a kind of credit facility, so that we can transfer money to Ukraine without European taxpayers having to cover the entire cost,” Frederiksen said.

The Hungarian Prime Minister will not be present for the first part of the European Summit as he is scheduled to give a speech at 13:00 in Budapest to mark Hungary’s national day that commemorates the 1956 uprising against Soviet rule.

Orbán will arrive around 17:00 in Brussels. Until then, he will be represented by his Slovak counterpart, Robert Fico.

Hungary will not support the conclusions on Ukraine, and this part will be released by the EU26, without Hungary.

Christian Stocker, Austria’s centre-right chancellor, told reporters that he has concerns about the use of Russia’s frozen assets in a reparation loan EU leaders are considering to finance Ukraine’s defence and reconstruction.

“We need to find a reasonable, fair solution that also corresponds to the intentions of the European Union, because it would be surprising if we treated a European company, a company from Europe, from Austria, worse than a Russian oligarch in Putin’s sphere of influence.”

“Donald Trump understood that peaceful cooperation with this aggressive Putin is not possible,” Manfred Weber, the president of the European People’s Party, said upon entering the EPP’s pre-EUCO summit, commenting on the US decision to impose sanctions on Russia.

“There is no Budapest peace summit, but there are now sanctions from Donald Trump against Putin. That’s a political reality, and that means we are stronger now as Europeans together with the Americans in defending our European way of life together with Ukraine”, he said. “We are now more united than ever before again with our American friends in our approach to Russia.”

“In Alaska, we saw that more red carpet is not possible. Trump did really everything to please Putin and to offer him a lot. And the answer was more bombing against Kyiv and even attacks against Estonia and Poland. That is what we saw during the summer and after summer. […] Who still believes that we can please Putin and we can be with more diplomatic efforts, and being more active with him is naive,” Weber added.

He also said that Wednesday’s vote in the European Parliament that rejected the package to simplify rules for European businesses on sustainability reporting and due diligence obligations is “very disappointing”.

“We had an agreement within the platform of the pro-European parties in the EU […] In the plenary, 31 socialist colleagues signed the appeal to reject this common compromise. And that’s why I have to ask Iratxe García Pérez [S&D chair] and the socialist team, what is this all about? Can we rely on a signature you give to us?”

Read the story on the Parliament’s simplification vote here

European leaders are making their way to the summit, but what exactly is on the agenda?

Support for Ukraine, climate goals and China’s curbs on rare earths are some of the topics poised to animate the day, and possibly the night.

Here’s what you need to know.

Hello and welcome to Euronews’ live blog for the leaders’ summit that will take place in Brussels on Thursday.

Our crack team of reporters will bring you the latest on the wide-ranging discussions that will cover support for Ukraine, European defence, competitiveness, the Middle East, migration and even, for the first time ever, housing.

Here’s the provisional schedule:

• 08:30 Arrivals and doorsteps
• 10:00 Exchange of views with the President of the European Parliament
• 11:00 European Council working session – morning
• 13:30 European Council working lunch
• 15:00 European Council working session – afternoon
• 20:00 Euro Summit working dinner

European Council chief Antonio Costa wants this summit to be a one-day affair so, given the packed agenda, expect us to still be at it well after dinner and into the night.