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EU drafts law to send Russian Central Bank profits to Ukraine

EU drafts law to send Russian Central Bank profits to Ukraine EU plans to use the profits of the Central Bank of the Russian Federation for the needs of Ukraine (photo: Getty Images)

According to the EU proposal, Ukraine will begin receiving funds from the profit of the Central Bank of the Russian Federation starting in July. These funds will be used for the supply of weapons and the development of the defense industry, reports Bloomberg.

The proposals include the introduction of a tax on the income derived from immobilized reserves, aiming to use around 3 billion euros annually for the benefit of Ukraine.

About €260 billion in assets of the Russian central bank, mostly in the form of securities and cash, have been immobilized by the Group of Seven nations, the EU, and Australia with more than two-thirds of those blocked in the EU.

The funding has become especially critical as Ukraine faces a shortage of artillery and some $60 billion of US assistance remains blocked in Congress, the statement said.

Confiscation of Russian assets

The issue of confiscating Russian assets for the benefit of Ukraine is becoming more relevant due to the lack of new assistance from the US.

Overall, since the start of the war in Ukraine, Western countries have frozen around 750 billion dollars of Russian assets.

As early as February 28, European Commission President Ursula von der Leyen called on the EU to start discussions on using the profits from frozen Russian assets for joint purchases of military equipment for Ukraine. She emphasized that there is no stronger symbol or greater benefit for this money than to make Ukraine and the whole of Europe safer.

Additionally, on March 7, the government of Ukraine held a meeting regarding the confiscation of Russian assets worth 300 billion euros.

The Council of States of Switzerland supported the idea of transferring confiscated Russian assets to Ukraine. The parliament's decision allows the government to create an international legal basis for using the assets of aggressor states to pay reparations to affected countries. It will develop an initiative that provides for the lawful transfer of frozen assets of the aggressor's central bank to the country that was attacked.

By the way, the economic advisor to the president, Oleh Ustenko, stated that the frozen assets of Russia do not compensate for the losses in Ukraine. "We are talking about approximately 750 billion dollars, if we are discussing direct losses. If we add indirect losses, the figure will increase to 1 trillion," the official noted.