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G7 countries won't unfreeze Russian assets until Ukraine is compensated for losses

18 April, 2024 Thursday
12:03

G7 finance ministers and central bankers meet in Washington to discuss the conflict in the Middle East and the use of frozen Russian assets for Ukraine's benefit

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Reuters reports this.

The ministers met on the sidelines of the spring meetings of the International Monetary Fund and the World Bank in the US capital.

In a joint statement released after the meeting, they said they would ensure close coordination of any future measures aimed at reducing Iran's ability to acquire, produce or transfer weapons to support destabilizing regional activities and promised to continue working on all possible ways to use frozen Russian assets to help Ukraine.

The G7 finance ministers emphasized that they are committed to helping Ukraine meet its urgent short-term financing needs, including the use of extraordinary proceeds from frozen Russian assets.

"We reaffirm our determination to ensure that Russia pays for the damage it has caused to Ukraine. Russia’s sovereign assets in our jurisdictions will remain immobilized until then, consistent with our respective legal systems," the G7 officials said.

No specific plan for Russian assets was discussed, but the ministers said they would continue to work to ensure that frozen Russian assets could also be used for the benefit of Ukraine. They are likely to be presented at the summit in Italy in June.

What is known about the confiscation of Russian assets

On November 30, the US Senate introduced a bill to confiscate Russian assets. On January 11, the Biden administration supported the confiscation of Russian assets for transfer to Ukraine.

Meanwhile, the European Commission has a plan to raise €15 billion from Russia's frozen assets to provide financial assistance to Ukraine.

At the same time, Russia has estimated that the West could lose assets and investments worth at least $288 billion if it confiscates frozen Russian assets to help rebuild Ukraine, and said Moscow would retaliate.

On January 22, media reported that EU foreign ministers were approaching an agreement on how to use the frozen Russian assets.

Later, Belgian Ambassador to the United States Jean-Arthur Regibeau said that Western countries should make a collective decision to confiscate frozen Russian assets, most of which are held in the Brussels-based Euroclear settlement center. 

On January 24, a US Senate committee approved a bill to confiscate Russian assets and transfer them to Ukraine.

On January 30, the Political Affairs Committee of the Parliamentary Assembly of the Council of Europe adopted a draft resolution that provides for the confiscation of frozen Russian assets and their transfer to a new fund for the restoration of Ukraine.

Europe holds €191 billion of Russia's €260 billion of frozen foreign assets, which generated €4.4 billion in profit in 2023, and they want to transfer them to Ukraine.

The G7 countries and the EU are discussing a plan to use the frozen assets of the Russian central bank worth more than $250 billion as collateral to finance Ukraine's recovery.

On February 12, the EU Council adopted a decision to regulate the future mechanism for using the proceeds of frozen Russian assets in the EU in favor of Ukraine.

British Prime Minister Rishi Sunak said that Western countries should be bolder in confiscating Russian assets that they froze after Russia's full-scale invasion of Ukraine.

Japanese Finance Minister Sunichi Suzuki insists that the use of frozen Russian assets must comply with international law. This topic is likely to be discussed at a meeting of his colleagues from the G7 countries.

On April 17, US Treasury Secretary Janet Yellen said that the G7 countries continue to consider a number of possibilities to unlock almost $300 billion of frozen Russian assets to help Ukraine.

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