G7 leaders agree on $50B in Ukraine aid using frozen Russian assets
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Group of Seven leaders during the first day of a meeting in Fasano, Italy, on June 13. Photo: Alessandra Benedetti - Corbis/Corbis via Getty Images
Group of Seven leaders have agreed to send Ukraine $50 billion in aid by the end of the year by using profits generated by around $300 billion worth of sovereign Russian assets frozen in Western countries, President Biden said on Thursday.
Why it matters: In its third year on the defense against Russia's unprovoked invasion, the aid will be a major boon for Kyiv, which has been desperate for additional financial and military assistance.
- But the move may open Western assets in Russia to retaliatory confiscations made possible by a decree signed by Russian President Vladimir Putin earlier this year.
Context: The agreement comes after Western leaders have debated for months on if or how they should leverage Russia's assets to either help with Ukraine's defense or recovery from the invasion.
- The U.S. has proposed seizing the assets outright, a move European leaders are hesitant of over legal and financial concerns.
- The EU last month instead agreed to aid Ukraine using only interest from the frozen assets, which generate between $2.7 and $3.3 billion, annually.
Zoom in: The deal came together as G7 leaders started a summit in Italy on Thursday and before an international peace conference on Ukraine in Switzerland, which is set to start on Saturday.
- Biden publicly announced the agreement on the frozen assets during a bilateral press conference with Ukrainian President Volodymyr Zelensky on Thursday.
- The conference was held directly after they signed a 10-year security agreement between the U.S. and Ukraine meant to bolster Kyiv's military.
What they're saying: "This agreement is about security, protecting human life, fostering cooperation, and strengthening our nations," Zelensky said of the security agreement.
- "It includes steps to guarantee sustainable peace and benefits everyone globally, because Russia's war against Ukraine is a real global threat," he added.
- Ukraine signed a similar agreement with Japan, which will provide Kyiv $4.5 billion in defense assistance, humanitarian aid, technical and financial cooperation throughout 2024, according to Zelensky.
The big picture: Broadly, the agreement entails Ukraine receiving $50 billion in loans that will be serviced by the interest generated by the frozen assets.
- More technical details of the agreement, such as which country or countries will lend the money to Ukraine, may still need to be ironed out, but it's a powerful sign of unity between G7 nations and should secure financing for Kyiv through 2025.
Go deeper: U.S. expands sanctions against Russia over Ukraine invasion
Editor's note: This story has been updated with details from the press conference with Biden and Zelensky.
