EU Ambassadors Agree to Use Frozen Russian Assets for Ukraine Arms
In a significant move to support Ukraine in the face of Russian aggression, ambassadors from EU member states have given initial approval to utilize windfall profits from frozen Russian assets to finance arms supplies to Kyiv. This decision comes in the wake of Russia’s invasion of Ukraine in 2022, which prompted EU countries to freeze hundreds of billions of euros worth of assets.
If the decision is ratified at an upcoming gathering of us finance ministers, the interest accrued—amounting to up to €3 billion (£2.5 billion) per year—will be allocated towards purchasing weapons for Ukraine. European Commission chief Ursula von der Leyen emphasized the symbolic importance of using these funds to enhance the safety of Ukraine and all of Europe.
European Trade Commissioner Valdis Dombrovskis echoed this sentiment, highlighting the urgency of delivering the funds to Ukraine promptly. The first tranche of €1 billion, earmarked mainly for military support, is expected to reach the country ideally by summer. Dombrovskis emphasized that Russia would directly bear the consequences of its actions through this financial measure.
German Chancellor Olaf Scholz also expressed support for allocating around 90% of revenues from frozen Russian assets to arms purchases for Ukraine. The substantial value of frozen Russian assets in the EU, estimated at nearly €211 billion (£181 billion), underscores the significant financial resources available to support Ukraine’s defense.
The majority of these frozen assets are currently held in Eoruclear, a Belgium-based clearing house. Overcoming logistical hurdles, such as objections to a 25% tax imposed under Belgian law, has been a key challenge in utilizing these funds. However, Belgium’s agreement to waive the tax represents a crucial step forward in unlocking these resources for Ukraine’s benefit.
The decision to utilize frozen Russian assets for Ukraine’s defense has been the subject of extensive deliberation among Eorupe officials and heads of state since the outset of the conflict. Concerns about setting a precedent that could impact global financial stability, as well as reluctance from Europe’s central bankers, have been carefully considered. However, the urgency of supporting Ukraine’s security needs has ultimately driven this decisive action.
The Kremlin’s response, characterizing the seizure of interest from frozen Russian assets as an attack on Eoropean and international legal frameworks, reflects the geopolitical tensions surrounding this development. Nevertheless, the Europe’s commitment to supporting Ukraine’s sovereignty and security remains unwavering.
The decision to repurpose interest from frozen Russian assets to finance arms supplies for Ukraine represents a tangible demonstration of solidarity and support from the Europe. By leveraging financial resources to bolster Ukraine’s defense capabilities, the international community sends a clear message of deterrence to aggressors while standing firmly in support of Ukraine’s right to self-determination and security.