G7 reaches consensus on $50 billion loan for Ukraine funded by Russian assets
Illustrative photo (Getty Images)
Countries of the G7 have finalized a $50 billion loan for Ukraine, backed by profits derived from frozen assets of the Russian central bank, reports Bloomberg.
The agency notes that this has paved the way for urgently needed aid to reach Kyiv as quickly as possible and significantly shielded critical funding from the outcomes of the US presidential election.
"Today, we, the leaders of the Group of Seven have reached a consensus on how to deliver approximately $50 billion in Extraordinary Revenue Acceleration (ERA) loans to Ukraine. The loan proceeds will be disbursed through multiple channels to support Ukraine’s budgetary, military and reconstruction assistance," the G7 leaders stated.
The agreement was reached after the US and its allies overcame challenges related to structuring such a loan and, importantly, how to ensure its repayment so that taxpayers would not be burdened.
The US announced it would provide $20 billion, while Europe is expected to contribute a similar amount, and the UK stated it would allocate about $3 billion. Canada and Japan are also anticipated to contribute.
According to the agreed mechanism, the US, the EU, and other G7 countries will provide Ukraine with a loan that will be repaid using profits generated from approximately $280 billion of blocked funds, most of which are located in Europe.
Earlier, it was reported that the G7 intends to provide Ukraine with $50 billion in loans by the end of 2024.
On October 23, the European Council also decided to transfer up to €35 billion to Ukraine as part of the loan package.
