G7 agrees on structure of $50 billion loan to Ukraine, disbursed by end of year
The G7 countries have agreed on a loan structure based on the size of their economies to provide Ukraine with about $50 billion in new aid package, which will be disbursed by the end of the year.
Source: Bloomberg reports, citing sources.
Details: The Group of Seven countries will provide Ukraine with loans that will be repaid from the proceeds of approximately US$280 billion in blocked funds, most of which are in Europe.
This agreement is expected to provide critical support to Ukraine in the medium term and help cover its financing needs until 2025 and beyond.
Under the arrangements to be signed in Italy, the United States, the European Union and other participants will provide Ukraine with a loan, and the income generated from the assets over time will be used to repay the money, the agency's sources said.
The loans will be structured differently based on each participant's internal procedures, and each will bear the risk of the loans if the frozen assets yield less than expected.
Final technical details will be agreed after the summit, the people said. The aid could be used to support Ukraine's defence, economy and recovery. The specifics of the deal could change when leaders meet on Thursday.
For the G7, the move is a signal to Russia that they are ready to keep supporting Ukraine in the long term.
Read more: Challenges of Confiscation: What Will Help Ukraine Achieve Transfer of Russian Assets
Background:
- The Group of Seven countries will create a fund to support Ukraine using the proceeds of frozen Russian assets.
- G7 adopts US$50 billion loan for Ukraine at expense of Russian assets, France says.
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