Ukraine To Spend 1st 1.5 Billion Euros Of Frozen Russian Assets On Weapons

The Russians are expected to sue to prevent the transfer of assets but their options and leverage are considered limited. JL

New Voice of Ukraine reports:

The international depository Euroclear in Belgium, where a significant portion of Russia's frozen assets are stored, promises to make the first installment of €1.5 billion in July 2024.Ukraine will spend the first €1.5 billion of proceeds from Russia's frozen assets on arms purchases for  necessary weapons — air defense systems, artillery shells — and to develop the Ukrainian defense industry.  $280 billion in frozen assets of the Russian central bank, most of which are located in Europe are expected to generate €3 to €5 billion ($3.28 to $5.47 billion) per year

Ukraine will spend the first €1.5 billion of proceeds from Russia's frozen assets on arms purchases, Ukrainian Prime Minister Denys Shmyhal said after a government meeting on July 23.

He noted that the international depository Euroclear in Belgium, where a significant portion of Russia's frozen assets are stored, promises to make the first installment of €1.5 billion in July 2024.

Shmyhal said that the funds will be used to purchase necessary weapons — air defense systems, artillery shells — and to develop the Ukrainian defense industry.

 

"Ukraine insists on the principle that all Russian assets in the West should be confiscated and used for the restoration and defense of our country, as this will be responsible, fair, and just,” the PM said.

European Commission spokesman Christian Wiegand said on July 10 that the European Union would transfer the first part of the proceeds from Russia's frozen assets to Ukraine for military aid in the coming weeks.

Use of frozen Russian assets to help Ukraine

Ukraine's Western allies have been discussing for several months how to use the profits from about $280 billion in frozen assets of the Russian central bank, most of which are located in Europe. Income from these assets is estimated at €3 to €5 billion ($3.28 to $5.47 billion) per year, Bloomberg reported.

U.S. Treasury Secretary Janet Yellen did not rule out at the end of May that the G7 countries could provide Ukraine with a multi-billion dollar loan and use the interest received from $300 billion of frozen Russian assets.Washington, together with its G7 partners, was making progress on the issue of providing aid to Ukraine through proceeds from Russian assets, Brent Neumann, assistant to the head of the U.S. Treasury Department for international finance, said in early June.

The U.S. is pushing Britain, Canada, France, Germany, Italy, and Japan to provide up to $50 billion in loans backed by proceeds from frozen assets in the short term, Reuters reported.

The G7 leaders reached an agreement on the $50 billion transfer to Ukraine utilizing frozen Russian assets, according to an official statement from Paris on June 12.

Read also:

 EU approves €1.4 billion military aid to Ukraine from frozen Russian assets – Politico

G7 leaders reached a political agreement to provide Ukraine with financial support in the amount of about $50 billion by the end of the year, Italian Prime Minister Giorgia Meloni reported on June 13.

EU Trade Commissioner Valdis Dombrovskis said on June 21 that Ukraine would receive the first tranche of €1.5 billion from the profits from Russian assets frozen in the EU “before the summer holidays.”