The finance ministers of the Group of Seven (G7) countries welcomed the use of frozen Russian assets to pay reparations to Ukraine.
This is stated in the G7 statement of December 8.
They also noted that they will continue to support Ukraineʼs implementation of reforms, including in the fight against corruption.
The G7 countries also stated that they are ready to increase pressure on Russia if peace talks fail and called "preserving Ukraine" a priority on the agenda during the upcoming French presidency.
What is a "reparation loan"?
The possibility of providing Ukraine with a €140 billion loan using frozen Russian assets has been discussed since early October. At that time, EU leaders were unable to agree on the loan — Belgium opposed it, and France and Luxembourg were concerned about the legal consequences.
The European Commission officially presented the idea of a reparations loan on December 6, and its details were revealed by Politico. This loan is to consist of €165 billion: €25 billion of frozen Russian state assets held in private bank accounts across the European Union, and €140 billion held in the Belgian financial institution Euroclear. The money is planned to be distributed as follows:
- €115 billion will be allocated to finance Ukraineʼs defense industry;
- €50 billion will cover Ukraineʼs budget needs;
- €45 billion will be used to repay the loan that the G7 provided to Ukraine in 2024.
Belgium is opposed to the loan, worried that Russia would sue it if the plan goes ahead, as the frozen assets are held in Belgiumʼs Euroclear. Belgian Prime Minister Bart de Wever has asked the other 26 EU countries to guarantee coverage of the legal and financial risks.
Meanwhile, according to Bloomberg, Russia has prepared a response to the Westʼs possible "reparations loan" to Ukraine — it will nationalize foreign assets.
And on December 5, Bloomberg, citing sources among European diplomats, wrote that the United States had lobbied several EU countries not to use Russian assets for reparations loans for Ukraine. American officials convinced EU member states that these assets were needed to secure a peace agreement between Kyiv and Moscow, so they should not be used to continue the war.
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