US plans on paying USD20 billion into loan for Ukraine
Date
10/21/2024 5:17:07 AM
(MENAFN) The United States is poised to contribute up to USD20 billion to Ukraine as part of a G7 loan agreement, according to a report by the financial Times. This financial assistance will be repaid using the proceeds generated from Russian assets that have been immobilized by Western sanctions linked to the ongoing conflict in Ukraine.
As the year draws to a close, Ukraine's allies are intensifying negotiations to finalize this loan. There is growing apprehension that U.S. aid to Ukraine might diminish if Donald Trump, who has expressed intentions to reduce support for Kiev, wins the upcoming presidential election. This concern underscores the urgency of securing funding before any potential political shifts in the U.S. government.
Since the outbreak of the conflict in 2022, the U.S. and its allies have frozen approximately USD300 billion in Russian state assets. Of this total, around EUR197 billion (equivalent to USD214 billion) is held by Euroclear, a Brussels-based clearinghouse. As of mid-July, these immobilized assets had accrued roughly EUR3.4 billion (USD3.7 billion) in interest.
Moscow has condemned the asset freeze, labeling it as "theft" and asserting that any seizure of its funds would violate international law, potentially eroding trust in the Western financial system.
In June, G7 nations reached a consensus to extend a USD50 billion loan to Ukraine, which is expected to be financed through the interest generated from these frozen Russian assets. Initially, the U.S. and the European Union were slated to contribute USD20 billion each, with Canada, Japan, and the UK set to collectively provide the remaining portion of the loan.
This strategic financial maneuver reflects the international community's commitment to supporting Ukraine amid ongoing tensions with Russia, even as challenges surrounding the political landscape in the U.S. loom on the horizon.
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