G7 leaders strike ‘provisional’ deal on $50 billion Russian frozen assets loan to Ukraine

3 months ago 19

G7 negotiators agreed on Thursday (13 June) on a loan plan based on the size of their economies to provide Ukraine with about $50 billion in aid, expected to start flowing by the end of the year, according to people familiar with the matter.

“It’s done – at sherpa level, it is agreed and I do not expect any [of the] leaders (…) to block it,” said one of the officials, speaking on the condition of anonymity.

“There is a provisional agreement, but, of course, it still needs formal approval from the G7 leaders,” the official said, in reference to the final communiqué of the summit, held in Italy from 13 to 15 June.

Under the deal, G7 members would provide “approximately $50 billion” to Ukraine by the end of the year to cover its financing needs through 2025 and beyond, backed by the future windfall profits from Russian immobilised assets.

The new injection of aid would be used to support Ukraine’s defence capabilities, economy and reconstruction needs, the people familiar with the matter confirmed.

Technical details of the agreement were yet to be worked out at a later stage, including who would bear the ultimate risk of the loan to Ukraine, and how the money would be distributed.

G7 leaders were also expected to confirm that Russia’s assets would remain immobilised until Moscow ended its war against Ukraine, they added.

The formal agreement, which is a central deliverable of the G7 summit, is expected to be announced on Thursday when Ukraine’s President Volodymyr Zelenskyy joins the leaders for a session on Ukraine.

It comes after G7 members in the past days were inching towards a deal.

“I am very confident that an agreement could be made in the hours to come,” European Commission President Charles Michel told a group of reporters, including Euractiv, at the sidelines of the summit.

Eurozone finance ministers gave their political backing last week but said the exact terms would need to be discussed after the G7 summit gives political guidance.

[Edited by Zoran Radosavljevic]