The G7 countries are exploring the possibility of using all frozen Russian assets to help achieve a just and lasting peace in Ukraine, as well as to support its implementation of economic reforms.
This was stated in a joint statement by the G7 finance ministers, released on December 8, according to Suspilne.
The G7 countries have expressed their readiness to consider the use of all frozen Russian funds to support peace in Ukraine. This position was announced during a meeting of the G7 finance ministers, which also included representatives from the International Monetary Fund, the World Bank, the Organisation for Economic Co-operation and Development, and the Financial Stability Board.
“We will continue to work together on developing a broad range of financial support measures for Ukraine – including the possible use of all Russian sovereign funds frozen in our jurisdictions until Russia pays reparations – to end the war and ensure a just and lasting peace in Ukraine,” the document states.
In addition, the G7 pledged to support the Ukrainian authorities in implementing reforms, particularly in combating corruption and improving the management of state-owned enterprises. The finance ministers emphasized their readiness to increase pressure on Russia in the event of failed peace negotiations. The meeting also discussed strengthening cooperation with international partners and enhancing collective economic and financial resilience.
What is known about a potential reparations loan to Ukraine
On September 10, European Commission President Ursula von der Leyen proposed the idea of a reparations loan for Ukraine. The loan would be based on the remaining Russian assets held in Western countries.
Approximately €210 billion of Russian assets held in Europe are stored in the Belgian depository Euroclear. Of this, €175 billion has already been converted into cash, which could serve as the basis for the loan. At the same time, the EU first aims to return the €45 billion G7 loan ($50 billion) agreed upon last year. This would leave around €130 billion for a new mechanism.
According to EU Commissioner for Economy Valdis Dombrovskis, the decision on the loan amount will be made after an assessment by the International Monetary Fund.
EU officials told Reuters that the European Union is considering providing Ukraine with a reparations loan of up to €130 billion.
On October 20, an EU diplomat told Suspilne that on October 23 the EU would discuss the use of frozen Russian assets for a reparations loan to Ukraine. Although Hungary opposes the compensation mechanism, Brussels still aims to achieve unanimity among all 27 EU member states regarding this instrument.
At the end of September, it was reported that the European Commission had prepared a tool for Ukraine that would allow the use of frozen Russian assets. The first discussion at the leaders’ level took place in Copenhagen on October 1 at an informal summit.
