G7 Leaders Agree to $50 Billion Loan for Ukraine Backed by Russia’s Frozen Assets
WASHINGTON — Leaders of the Group of Seven wealthy democracies have reached a consensus to provide a $50 billion loan to aid Ukraine in its battle for survival. The loan would be secured by the interest earned on profits from Russia’s frozen central bank assets.
The specifics of the agreement are still being finalized by G7 leaders at their summit in Italy. It is anticipated that the funds could be delivered to Kyiv before the conclusion of the year, as reported by U.S. and French officials.
During a news conference on Thursday, President Joe Biden described the move as a “historic agreement.” Ukrainian President Volodymyr Zelenskyy added that the loan facilitated through Russia’s assets represents a crucial advancement in extending sustainable assistance to Ukraine in its fight against the war.
The majority of the finances will come in the form of a loan predominantly guaranteed by the U.S. government, supported by profits generated from approximately $260 billion in immobilized Russian assets, predominantly held in European Union nations.
While the assets remain inaccessible to Moscow, unlocking them for Ukraine’s benefit necessitates a complex legal process, including judicial procedures and a legal basis. The G7 leaders are also considering the possibility of confiscating the Russian assets entirely in the future.
The loan could be utilized by Ukraine for military, economic, humanitarian, and reconstruction purposes, as outlined by a U.S. official. The goal is to expedite the allocation of funds to Ukraine to aid in combating Russia’s ongoing aggression and to bolster the nation’s resilience.
The move to unfreeze Russia’s assets follows a delayed approval by the U.S. Congress for military aid to Ukraine. Amid concerns about burden-sharing in the event of a default, European finance ministers have raised apprehensions about their countries being left with the financial responsibility if Ukraine fails to repay the loan.
There has been criticism of the plan from some quarters, with Chinese Embassy spokesman Liu Pengyu asserting that the U.S. is exacerbating the conflict and inciting confrontation, calling for a constructive diplomatic resolution to restore peace.
[Featured image description: U.S. President Joe Biden listens to a question during a news conference after signing a bilateral security agreement with Ukraine’s President Volodymyr Zelenskyy during the sidelines of the G7 summit at Savelletri, Italy, Thursday, June 13, 2024. (AP Photo/Andrew Medichini)]
