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US, Europe agree to lock up Russian assets until it pays for Ukraine war, clearing way for USD 50 billion loan

US and European leaders to use frozen Russian assets to provide financial support to Ukraine, as announced at the G7 Summit

AP Borgo Egnazia (Italy) Published 13.06.24, 07:58 PM
From left, European Council President Charles Michel, German Chancellor Olaf Scholz, Canada's Prime Minister Justin Trudeau, French President Emmanuel Macron, Italian Prime Minister Giorgia Meloni, U.S. President Joe Biden, Japan's Prime Minister Fumio Kishida, Britain's Prime Minister Rishi Sunak and European Commission President Ursula von der Leyen stand for a group photo at the G7, Thursday, June 13, 2024, in Borgo Egnazia, Italy.

From left, European Council President Charles Michel, German Chancellor Olaf Scholz, Canada's Prime Minister Justin Trudeau, French President Emmanuel Macron, Italian Prime Minister Giorgia Meloni, U.S. President Joe Biden, Japan's Prime Minister Fumio Kishida, Britain's Prime Minister Rishi Sunak and European Commission President Ursula von der Leyen stand for a group photo at the G7, Thursday, June 13, 2024, in Borgo Egnazia, Italy. AP/PTI

The United States and European countries have agreed to lock up sanctioned Russian assets until Moscow pays reparations for its invasion of Ukraine, a senior US official said on Thursday. The move clears the way for leaders to announce a USD 50 billion loan package for Kyiv at the Group of Seven summit.

The highly anticipated agreement will leverage interest and income from the more than USD 260 billion in frozen Russian assets, largely held in Europe, to secure a USD 50 billion loan from the US and additional loans from other partners.

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The first disbursements will be made this year, but it will take time for Ukraine to use all the money, the official said. The official spoke on the condition of anonymity to preview the agreement, which will be included in the G7 leaders' communique on Friday.

President Joe Biden will meet on Thursday with Ukrainian President Volodymyr Zelenskyy to discuss a bilateral security agreement between the US and Ukraine. The international group of wealthy democracies has been looking for new ways to bolster Ukraine's defences against Russia.

The leaders' statement will also leave the door open to confiscating the Russian assets entirely, for which the allies have yet to secure the political will, largely citing legal and financial stability concerns.

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