EU discusses options on how to guarantee US$50 billion loan for Ukraine from Russian assets
On Friday 13 September, the European Commission presented its member states with options for extending the term of the sanctions regime against Russia in order to unlock an agreement on the use of frozen Russian assets in favour of Ukraine.
Source: Euractiv, as reported by European Pravda
Details: The European Commission's proposal is related to the Group of Seven countries' plan to assist Ukraine with a US$50 billion loan from frozen Russian assets, and it is intended to ensure that these assets are not unfrozen until Russia agrees to pay reparations.
The EU executive body gave the permanent representatives of the member states three alternatives for further action.
The first entails freezing Russia's assets for five years, with the option of reviewing every 12 months and obtaining permission from a qualified majority of member states. The second option is to unanimously extend the freeze every 36 months. The third alternative calls for the prolongation of all sanctions against Russia for 36 months.
The majority of EU ambassadors at Friday's meeting were open to the proposed solutions, although several raised doubts. Among other things, Belgium raised the possibility of lawsuits against the Euroclear depository in its territory, where the majority of the assets are frozen.
France insisted that a portion of the financing for Ukraine go towards military spending.
According to Euractiv, the discussion of further freezing Russian assets is likely to be on the agenda of the EU leaders' summit in Brussels in mid-October.
The European Union wants to implement the agreement before the November US elections so that there is no ambiguity regarding the status of Ukraine's financial support.
At the June meeting, the leaders of the Group of Seven provided their political permission to the use of excess revenues from frozen Russian assets in their jurisdictions, which amount to around US$50 billion each year.
As expected, the European Union would provide the vast majority of the loan to Ukraine at the expense of Russian assets.
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