The G7 nations have agreed to offer Ukraine a loan worth $50 billion from funds obtained from the frozen Russian state assets," confirmed the diplomats on Thursday, the summit opening day, which was held in Italy. This mega inflow of finances is sent to Ukraine for strengthening its military defenses against the Russians, rebuilding infrastructure, and financing the budget of Ukraine nationally.
Since the far-reaching sanctions were imposed over two years ago after Russia's full-scale invasion of Ukraine, about $280 billion of Russian central bank assets have become immobilized in Western countries-with a good bulk of that being kept within the European Union. Recently, EU member states have green-lighted the use of interest that has been accrued from these assets to fund humanitarian aid and other forms of support for Ukraine.
Euroclear, the largest owner of the frozen Russian assets in the EU, recently disclosed that it had received close to $4.7 billion in interest income this year. Planning to determine how the loan package would be structured has been under way for months. Preliminary US proposals indicated interest income, as well as the frozen assets themselves, could be used to help fund Kyiv. That idea, however, was met with very strong doubts from some European capitals.
In fact, over Thursday-to-Saturday, leaders of the G7 will meet in southern Italy in a summit where global economic issues and geopolitical challenges-mostly related to Ukraine and Russia-are expected to take center stage.
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