The United States supports the possibility of using frozen Russian assets as collateral for a $50 billion bond issue for Ukraine. This is reported by Bloomberg.
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The proposal provides for the consolidation of assets of the Russian central bank in the amount of $280 billion frozen by the G7 countries ) and the European Union in an SPV, the proceeds from which will support the so-called “freedom bonds”.
More than two-thirds of Russia's frozen assets are blocked in the EU, where they generate about $3.6 billion in net profits per year. Proceeds from the proposed bond offering would be nearly equal to the $60 billion in U.S. aid that is still stuck in Congress.
Western allies are trying to secure funding for Kiev at a critical moment in the war, as Ukrainian troops face an artillery shortage and Russia advances in the east.
Who could be against
Discussions are at an early stage and are ongoing, one of Bloomberg's sources said. Some G7 countries, including Germany and France, have expressed caution about the new idea, another source said.
The effort could bring in much more than $50 billion. Some EU countries, notably Estonia, have called on allies to be bolder and immediately confiscate Russia's frozen assets.
Previously, the G7 said that assets would remain frozen until Russia agreed to pay Ukraine for the damage it caused.
EU Disputes
G7 allies have in recent months discussed several options for using frozen Russian assets, from using the money as collateral to raise debts or issuing guarantees against frozen funds.
“But disputes remain between them over European reluctance do something that could be perceived as a seizure of assets, and this will lead to legal problems, retaliation from Moscow and jeopardize the stability of the euro,” the material says.
EU leaders are now nearing an agreement to use proceeds from blocked Russian assets to finance Ukraine's military needs.
Under plans unveiled this week, the bulk of the proceeds, largely held through the Belgian clearing house Euroclear, will be transferred to the European Peace Fund, a mechanism used primarily to reimburse governments for military purchases destined for Ukraine, and a smaller share for the regular budget. EU for Ukraine.
The US argument is to develop an option that maximizes income from frozen Russian assets so that Ukraine quickly receives more support.
Recall
The EU High Representative for Foreign and Security Policy, Josep Borrell, said that the amount that could be received from the proceeds of frozen Russian assets could be around 3 billion euros per year. The money will go towards military and civil support for Ukraine.
