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EU moves to ease US fears over $50bn Ukraine loan
The ambassadors of the 27 EU countries will convene today to deliberate on the European Commission’s proposal for the indefinite immobilization of the assets of the Central Bank of Russia. According to The Financial Times, this move aims to address US concerns regarding the use of these funds to support a $50 billion loan to Ukraine.
Currently, the EU sanctions on Russian assets, which amount to €260 billion, are renewed every six months. This frequent renewal has caused apprehension among EU allies about the stability of the loan’s repayment. The proposal for indefinite immobilization seeks to provide maximum predictability for G7 partners regarding the loan’s repayment.
Another option under consideration is extending the sanctions’ validity from six months to three years. However, EU officials believe the indefinite immobilization option is more likely to gain Washington’s approval. Both options require unanimous consent from all EU member states, a challenging feat given Hungary’s past insistence on addressing the issue at the EU leadership level.
The G7 countries are also in discussions about how to divide the responsibility for the $50 billion loan, with the matter expected to be revisited during the G7 finance ministers’ meeting at the G20 summit in Rio de Janeiro. The current plan suggests the EU and the US would each contribute $20 billion, while Canada, the UK, and Japan would provide the remaining $10 billion.
If EU member states do not agree on the extension of sanctions, the European Commission might initially allocate a larger portion of the loan, up to €40 billion, with adjustments made later as other countries commit their shares.
@Ukraine_Report ~ 4rrasoe 🇮🇩❤️🇺🇦🔱