EU and G7 consider option of using Russia's assets for Ukraine
EU and G7 consider option of using Russia's assets for Ukraine (photo: sputnik.by)
The European Union and the Group of Seven (G7) countries are discussing the option of using Russia's frozen assets to help Ukraine. The Russian central bank's more than $250 billion is to be used to rebuild Ukraine, reports Bloomberg.
The EU and the G7 may sell Russian government debt using frozen assets as collateral, sources familiar with the matter told Bloomberg. The allies believe that Russia will be obliged to pay Ukraine for all the damage it has caused after the war is over. If it refuses, Russia may be subject to claims for the frozen assets.
Currently, according to Bloomberg sources, the discussion is being held at a technical level. No political decision has been made yet, but one of the Bloomberg sources said that some countries want to move faster than others.
Another Bloomberg source said that the plan being discussed by the EU and the G7 could allow for the creation of a special purpose entity that would issue zero-coupon bonds backed by recallable collateral. According to the source, a collateral hierarchy will be established that will utilize assets held by Euroclear as well as Western banks.
Confiscation of Russian assets
At the end of 2023, the Western press reported that the United States proposed to the G7 countries to confiscate frozen Russian assets worth $300 billion in favor of Ukraine. The initiative was supposed to be approved by February 24, 2024.
Today, the Financial Times reported on Belgium's initiative. Brussels has proposed a plan to the G7 countries that could allow the unblocking of frozen Russian assets in Europe.
