Russia Washington: G7 agrees on 50 billion loan for Ukraine

for which Russia is to pay indirectly. The loan is secured by interest income from frozen Russian assets. The partners have agreed on the details, said a representative of the US government. An official statement from the G7 states is expected today.

This concerns a loan that the G7 states and representatives of the European Union agreed at a summit in June. However, there were still some hurdles to overcome in the negotiations - particularly with regard to the EU sanctions rules. The US government has now emphasized that a way has been found to agree on the loan without the EU having to change its sanctions rules. "We will continue to press for these changes to be made," the US government representative emphasized at the same time.

Billion-dollar pledge from Europe too

The USA wants to contribute 20 billion dollars to the loan. US Treasury Secretary Janet Yellen had already announced this on Monday. German Finance Minister Christian Lindner had also said in New York that the European Union wanted to contribute 18 billion euros. That is also around 20 billion dollars. The remaining 10 billion dollars are to be provided by Great Britain, Japan and Canada.

The US government representative emphasized that the burden would be shared between the USA and the EU. This means that there are also "the same incentives to keep the assets immobilized until full repayment".

As part of the sanctions imposed on Russia by the EU, around 210 billion euros in assets of the Russian central bank have been frozen since February 2022. The extraordinary interest income from this is currently estimated at up to 2.5 to 3 billion euros per year. The majority of these assets are located in the EU.

The devil is in the detail

Should Moscow regain access to the money frozen in the EU before the loans are repaid in full, the EU and the other G7 partners involved would have to take over the repayment. This could happen, for example, if an EU state were to block the extension of Russia sanctions with a veto.

The government in Washington has therefore called on Brussels to amend the EU sanctions rules in order to have more certainty that the Russian funds earmarked for the repayment of the loans will actually remain frozen. Currently, the EU decision to freeze the funds must be extended unanimously every six months. The USA is pushing for this period to be extended to three years. However, the EU country Hungary has so far refused to give the necessary consent.

USA: Has confidence in the EU

The US government representative said: "Yes, there are airs and graces and dramas, but the EU has a track record of staying the course." This strengthens confidence that Russia's state assets will remain frozen until Russia has ended its war and paid for the damage it has caused.

Meanwhile, at the Brics summit of emerging industrial nations in Kazan, Kremlin leader Vladimir Putin emphasized the successes of his army in the war against Ukraine. Ukraine has been defending itself against a Russian invasion for over two and a half years. Putin had already sharply criticized the loan some time ago and described it as robbery. He warned that the G7's decision would "not go unpunished".

SDA