The Russian funds seized after the invasion wants to use or by providing great financial assistance to Kiev with a new loan of 140 billion euros.
This plan even gives a solution to one of the most thorny problems from the beginning of the war: that European authorities can use interest produced by Russian capital but not the underlying cash themselves, which have been “frozen”, which would have contributed even more to its ability to make it more capable.
The Commission developed the plan ahead of the meeting of its ambassadors on Friday, where the foundations for the meeting of European leaders in Copenhagen will be laid on Friday.
The repair loan in Ukraine
In the EU capitals there is accumulated frustration over the lack of at least so far, details of the so -called repair loan, which the Commission President said, said.
Most of the Russian assets are owned by the Brussels -based Euroclear financial company and is invested in bonds of western gain governments. The money resulting from them is on a deposit account at the European Central Bank.
The idea is for the EU to redirect the money in Ukraine and “conclude a custom debt contract with Euroclear at a 0%interest rate,” according to the new plan.
Euroclear owns 185 billion euros in cash linked to Russian assets, part of which will repay a pre -existing G7 loan to Ukraine.
The remaining 140 billion euros will be paid to Ukraine in installments and will be used for “defensive cooperation” as well as to support Kiev’s usual fiscal needs.
Supporters of ‘Remediation Loan’
Germany became a major supporter of the “repairs loan”, as Politico said earlier this week. German Chancellor Friedrich Mertz supported this idea in an opinion article published Thursday in the Financial Times – although he stressed that the loan should only finance military assistance.
On the other hand, the United Kingdom proposed last week its own “repairs loan” using about $ 25 billion “frozen” Russian assets. The finance ministers from the G7 countries have scheduled an online meeting next Wednesday to coordinate these initiatives.
The Commission states in its note that its proposal means that “all this operation will not touch Russia’s dominant assets (ie Euroclear claim)” and Ukraine will only repay the loan when Russia finishes the war and pays the war.
The greatest risk for the implementation of the plan
If that happens, the EU will repay Euroclear, so that it “has the necessary cash to comply with its obligation to Russia,” he said.
The biggest risk now is that an EU country – like Hungary – will block the renewal of sanctions to Russia, which must be unanimously agreed every six months. This would essentially return Russian cash to Moscow – and left the new loan to Ukraine.
To reduce this risk, the Commission suggested that the rules of renewal of sanctions from unanimity to a special majority change.
“This would require a high -level political agreement from all or most heads of state or governments,” the note concludes.
