A man waves to a taxi as he leaves the headquarters of the Russian Central Bank in downtown Moscow last summer. This week, the European Union approved a plan to use hundreds of billions of dollars in interest from seized Russian assets to help finance the Ukrainian military.
Alexander Nemenov/AFP via Getty Images
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Alexander Nemenov/AFP via Getty Images
A man waves to a taxi as he leaves the headquarters of the Russian Central Bank in downtown Moscow last summer. This week, the European Union approved a plan to use hundreds of billions of dollars in interest from seized Russian assets to help finance the Ukrainian military.
Alexander Nemenov/AFP via Getty Images
The European Union plans to use up to $3.25 billion in profits from Russian sovereign assets — frozen by sanctions over Russia’s war on Ukraine — to fund Ukraine and its military.
“Russia must pay for war damage,” Czech Foreign Minister Jan Libavski said as he shared the cash on X.
The European Council agreed to send the money to Ukraine on Tuesday, nearly two months after reaching consensus on the use of revenue from assets worth hundreds of billions of dollars that were frozen after Russia launched a full-scale war on its neighbor in February 2022.
In response to this action, Kirill Logvinov, who heads Russia’s permanent mission to the EU, claimed that the EU Council had “officially elevated theft to the status of its foreign policy tools.”
This statement came from an interview TASS translation, Russian state news agency. As for the potential ramifications of the EU’s move, Logvinov was quoted as saying: “The consequences of the precedent created will certainly be unpredictable, including for the euro area, the economies of the bloc’s member states, and the investment climate.”
The war has thrust Ukraine into a high-stakes conflict and immediate humanitarian crisis; The country also faces expensive and long-term rebuilding efforts.
The Biden administration is urging the European Union and its 27 member states to use funds from frozen Russian assets to help Ukraine, including by seizing the funds outright.
But opponents of pressure for the EU to redirect Russian assets to Ukraine have questioned the legality of such a move, and warn against setting precedents that could create complex ripple effects – and potentially undermine the euro’s international standing. If the EU seizes the assets, it will increase the possibility that Moscow will retaliate by seizing European property in Russia.
By choosing to drain profits rather than redistribute Russian assets, the EU is looking to avoid the toughest of these questions, while still offering a lifeline to Kiev.
Swede Anders Ahnlid, who led the reconstruction of Ukraine, said: “These windfalls, ranging from 2 to 4 billion euros annually, can be used to rebuild Ukraine without interfering with international law.” European Union Working Group regarding the use of frozen assets last year, NPR told in March.
Since the war began, the European Union, the G7 and other US allies have frozen about $282 billion in Russian central bank assets, with more than two-thirds of the total under EU jurisdiction, the EU Council said. He said in February.
In the face of “net gains resulting from unexpected and extraordinary revenues” resulting from those frozen assets and reserves, says the European Union 90% of the funds will be used to provide military support to Ukraine.
Part of the funds were also allocated to Ukraine’s defense industry infrastructure and reconstruction efforts. The European Union said the money would be collected from Russian accounts on a twice-yearly basis.
President Biden last month signed the Ukrainian Buyback Act — a measure that allows the United States to transfer Russian sovereign funds to Ukraine to help with reconstruction — as part of a reconstruction plan. Expanded security spending bill. a A bipartisan group of senators The company is now urging Biden to use this power and implement the new law before the next G7 meeting in June.
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