The World Bank created a new fund to support Ukraine

The Executive Board of the World Bank on Thursday, October 10, created the Financial Intermediation Fund (FIF) to support Ukraine. Initially, the first contributions to the fund will come from the United States, Canada and Japan.

Reuters writes about this with reference to sources.

The fund will be managed by the World Bank. He will help fulfill the promise of the G7 leaders to provide Ukraine with a $50 billion loan, which will be repaid with the proceeds of frozen Russian assets.

The vote at the World Bank took place the day after the European Union granted a €35 billion loan to Ukraine, which is part of the blocʼs commitments in the corresponding G7 decision regarding the frozen assets of the Russian Federation. During the vote, only Russia was against the creation of the fund.

Josh Lipsky, senior director of the Atlantic Councilʼs Geoeconomics Center, said the two decisions would allow the G7 countries to significantly increase funding to Ukraine and fulfill the promises of continued support to Ukraine that G7 leaders made at the summit in June.

According to him, in 2023, Ukraineʼs war expenses amounted to approximately $80-90 billion.

Frozen Russian assets

The value of frozen Russian sovereign assets in the EU is almost €211 billion. In total, the European Union, the G7 countries and Australia have frozen approximately €260 billion in securities and cash. In June 2024, the "Big Seven" countries agreed to provide Ukraine with a $50 billion loan by the end of the year, which will be repaid with profits from Russian assets.

Ukraine has already received several tranches of aid from the EU proceeds from frozen Russian assets. And on September 20, the head of the European Commission Ursula von der Leyen informed that the European Union will provide Ukraine with an additional loan of €35 billion at the expense of the frozen assets of the Russian Federation. The day before, on September 19, she announced that the European Union would allocate €160 million to support Ukraineʼs energy security ahead of winter. Part of the amount will be provided from frozen Russian assets.

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