Issue #1: Funding Ukraine with frozen Russian assets. Ukraine desperately needs more funding, but European budgets are stretched and no country wants to prioritize Ukraine over its own citizens. Now the EU has reached an impasse: Belgium recently blocked a long-awaited loan plan that would have used $160 billion in frozen Russian central bank assets to support Ukraine's war effort. Belgium fears it could be held liable if Russia successfully demands its money back, with Euroclear, the Belgian securities depository holding the funds, calling any confiscation illegal and accusing leaders of seeing the assets as a “pot of gold.”
EU proponents are scrambling to address Belgium's concerns by proposing to jointly guarantee the funds against potential Russian legal claims. But the Russian-friendly states of Slovakia and Hungary are opposed to this approach, or taking the funds at all.
According to Eurasia Group's Managing Director for Europe Mujtaba Rahman, “using these reserves has become a really important goal for many member states” as a way to demonstrate commitment to Ukraine without straining their own budgets. Commission President Ursula von der Leyen agrees, calling the frozen assets “the most effective way to sustain Ukraine's defense and its economy.” The challenge is convincing the holdouts to come onside.
Issue #2: Migration gridlock. Last month, interior ministers gathered to hammer out implementation details for the EU Pact on Migration and Asylum. The deal was adopted in 2024 to tighten border security, share the cost of hosting migrants, and streamline deportations. While most EU leaders support reform in principle, putting the pact into practice has sparked fierce disagreement.
At the heart of the dispute is the pact’s “solidarity pool,” designed to ease pressure on Southern European states — namely Spain, Greece, Italy, and Cyprus — by redistributing asylum seekers across the continent. Countries unwilling to accept migrants can provide financial compensation instead. But many nations, particularly in Eastern Europe, resist accepting migrants who wouldn’t otherwise reach their borders, and resent being financially penalized for refusing.
This pressure is fueling nationalist parties throughout the EU. “It’s not going to get better,” warns Rahman. “You’re going to continue to see far-right support increase because the perception is migration is running out of control and governments don’t have a handle on how to secure their borders.”
Issue #3: National sovereignty versus European law. The EU’s handling of migration provides ammunition for nationalist and Euroskeptic leaders like Slovakian Prime Minister Robert Fico. Riding that moment, Fico recently changed his country’s constitution to assert that national laws take priority over EU legislation.
The constitutional change accompanied an amendment recognizing only two sexes, and explicitly prioritizing Slovak law on matters of national identity, culture, and ethics. It echoes Poland’s 2021 clash with the EU, when Warsaw faced tribunal proceedings over conflicting laws on judicial reforms, media freedoms, and LGBT rights.
Slovakia’s moves directly challenges the EU’s legal framework, in which EU law supersedes national legislation to maintain unity across the bloc. “I want to be absolutely clear: the primacy of EU law must be upheld in all cases across the European Union,” declared EU Justice Commissioner Michael McGrath. The EU has issued a warning to Slovakia and will soon decide whether to pursue legal action.
The EU hopes cracking down on Slovakia will reinforce its own control over the bloc. But as ever, it risks exacerbating the current issues that it faces, and encouraging member states to prioritize national interests over that of the bloc.
