140 billion euros for Ukraine: EU prepares new financial package
The European Commission has developed a new initiative that involves using the proceeds from frozen Russian assets to finance a massive loan to Ukraine. The amount is 140 billion euros, which Kyiv will be able to receive to support the budget and strengthen the defense sector.
This is reported by Politico.
The proposal has already been presented to EU member states ahead of a key meeting of ambassadors on Friday, aimed at preparing for a summit of European Union leaders scheduled for next week in Copenhagen.
According to the concept, Ukraine’s debt repayment will begin only after the war ends and reparations are received from the Russian Federation. If this does not happen, the compensation of Euroclear (which holds the bulk of the frozen funds) will be provided by the European Union itself.
It is assumed that the loan will be issued in tranches, and the funds themselves will go both to strengthen Ukraine’s defense capabilities and to finance daily state expenses.
Following Russia’s invasion of Ukraine in February 2022, Western countries imposed tough sanctions targeting the Russian government, financial institutions, business elites, and companies linked to the Kremlin.
One of the key sanctions measures was the blocking of Russian assets abroad. This includes the foreign exchange reserves of the Central Bank of the Russian Federation, foreign real estate, bank accounts, and other financial instruments.
According to estimates by the IMF and a number of think tanks, the volume of such frozen assets exceeded 300–350 billion US dollars by 2024–2025. However, the exact figures remain unknown due to the dispersion of assets across different jurisdictions.
As a reminder, the European Union is preparing a mechanism that will allow Ukraine to transfer frozen Russian assets without their formal confiscation . Under the new scheme, Russia will remain the nominal owner of the funds, but Kyiv will actually be able to use them.
As reported, Ukraine has received another tranche of financial assistance from the European Union in the amount of 1 billion euros . The funds came from the proceeds of frozen Russian assets and are part of a large-scale G7 initiative to support Ukraine.
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