EU Approves Use of Frozen Russian Assets to Support Ukraine

The European Union approves using profits from frozen Russian assets to annually generate 3 billion euros ($3.3 billion) to aid Ukraine's defense against Russia's invasion, allocating 90% for weapons purchases and 10% for reconstruction efforts. This decision follows months of legal discussions and comes amid advocacy for a comprehensive plan from the United States and Britain at the upcoming G7 meetings.

On Tuesday, the European Union formally approved a plan to use profits from frozen Russian central bank assets to support Ukraine. This initiative aims to generate approximately 3 billion euros ($3.3 billion) annually to aid Ukraine in its defense against Russia's invasion.

Belgium, which currently holds the EU's rotating presidency, announced the decision on social media. The EU has frozen around 200 billion euros of Russian central bank assets within the bloc as part of sanctions against Russia for its military actions in Ukraine starting February 2022. About 90 percent of these funds are held by Euroclear, an international deposit organization based in Belgium.

Under the approved EU scheme, 90 percent of the interest generated from these frozen assets will be allocated to a central fund for purchasing weapons for Ukraine. The remaining 10 percent will be used for Ukraine's reconstruction efforts.

This decision follows months of legal discussions within the EU and comes as the United States and Britain advocate for a more comprehensive plan at the upcoming G7 meetings. The proposal from Washington and London involves issuing a $50 billion G7 loan to Ukraine, backed by future profits from frozen Russian assets held globally. If implemented, this G7 plan would likely replace the current EU scheme.

G7 foreign ministers will discuss the proposal in Italy this week, and a final decision could be reached by leaders at a summit next month.

This move to secure additional funding for Ukraine comes at a critical time. Ukrainian forces are facing significant challenges on the front lines, and there is growing concern about future support from the United States, especially if former President Donald Trump returns to office.

The EU's commitment to using these funds for Ukraine's military and reconstruction efforts underscores its continued support for Kyiv amid ongoing conflict with Russia.