June 20, 2024

Athens News

News in English from Greece

The United States is ready to provide billions of euros to Ukraine, secured by income from Russian assets

The United States is offering billions of euros to Ukraine “in debt”, secured by frozen Russian state assets.

G7 countries are divided over how to use the €260 billion worth of Russian assets frozen by the West following Russia's full-scale invasion of Ukraine in February 2022, the Financial Times reports.

Washington supports the idea of ​​confiscating the reserves in full and transferring them to Ukraine. However, according to European officials, this could violate international law and destabilize financial markets. European Union countries tend to give Kyiv only income received from assets.

In recent months, after the US Congress blocked aid to Ukraine, the issue of using Russian reserves to help Kyiv has become more pressing. Dalip Singh, deputy adviser for international economics to US national security, said last Wednesday in Kyiv:

“We are at a point where we must explore every possible avenue to maximize the value of the immobilized reserves for Ukraine. We cannot wait. We cannot wait forever, we know that.”

He explained that the US proposal provides for “the present value of the future interest flow from immobilized assets – either through bonds or through debt.” And he noted that the Europeans have already demonstrated their readiness to transfer interest from reserves to Ukraine on a semi-annual basis. However, there are ways to “increase the value of these income streams over time”:

“Instead of simply transferring annual earnings from reserves… it is conceptually possible to list 10-year earnings or 30-year earnings. The present value of these earnings is a very large figure.”

Meanwhile, let us recall that countries supporting Russia demand that EU abandon any plans to confiscate state assets in Moscow. The United States, writes the Financial Times, proposed to its G7 allies to create a special fund that would issue bonds worth at least $50 billion. These bonds will be secured by income from frozen Russian state assets, and the proceeds will be used to support Ukraine.

Meanwhile, House Speaker Mike Johnson on Friday discussed with White House officials a Ukraine and Israel aid package that would differ from the Senate's $95 billion support package and include several Republican demands before meeting with Trump.

Former US President Donald Trump, after a meeting with House Speaker Mike Johnson, made it clear that he had no objection to approving aid to Ukraine, but in the form of a loan, writes The Hill. Speaking with Johnson at his Mar-a-Lago villa, Trump said they were “thinking about doing this as a loan and not just a gift”:

“Now we continue to give out gifts worth billions and billions of dollars, and we are exploring this issue. But for me it is much more important that Europe should be more actively involved and give money. They should give something commensurate. If this does not happen, I will be very It’s a pity, because it concerns them much more than us.”

Trump has been skeptical for months about further US aid to Ukraine, arguing that it does not make a difference to vital US interests and that the main responsibility should fall on Europe. Trump's views have a significant influence on Republicans in Congress, having been one of the factors that has made it difficult to pass additional funding to support Ukraine.

Democrats in both houses of Congress have indicated that they would be willing to talk about loan assistance to Ukraine if it would help finally resolve the issue, although this is not the option they most favor.

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