“To be clear, nothing like this has ever been done before,” it states.
The White House announced that the Group of Seven, or G7, allies are proceeding with lending Ukraine $50 billion secured by Russian assets that have been frozen.
Earlier this year, leaders of the wealthy democracies decided to design the massive loan to support Ukraine in its conflict with Russia. Collateral would be the interest received on gains from Russia’s central bank assets that have been frozen.
The White House’s deputy national security advisor on international economics, Daleep Singh, announced on Wednesday that the US would provide $20 billion. Among other countries, the European Union, the United Kingdom, Canada, and Japan will contribute the extra $30 billion.
“To be clear, nothing like this has ever been done before,” Singh stated.
“Never before has a multilateral coalition frozen the assets of an aggressor country and then harnessed the value of those assets to fund the defence of the aggrieved party all while respecting the rule of law and maintaining solidarity.”
Debate over legality
According to Singh, the Biden administration plans to split its portion between providing military and economic assistance to Ukraine. To transfer military aid, Congress must take action.
“To be clear, either way, the US will provide $20 billion in support for Ukraine in this effort, whether it’s split between economic and military support or provided entirely via economic assistance,” Singh stated.
Singh stated that additional information regarding the loan is anticipated to be worked out during the G7 finance ministers’ meeting in Stresa, Italy, this week.
In June, the G7 declared that the majority of the loan would be secured by earnings from approximately $260 billion in Russian assets that had been immobilized. Most of the money is stored in countries that are part of the European Union.
Following months of discussion about whether it was permissible to seize the money and deliver it to Ukraine, the decision was made.
When Moscow began its “special military operation” against Ukraine in 2022, the United States and its allies promptly frozen any assets that the Russian central bank had access to.
