Economy

EU drafts law on transferring profits from Russian assets to Ukraine

The European Union has drafted a bill that would use the proceeds of frozen Russian assets to help Ukraine. This was reported by Bloomberg, according to Komersant ukrainskyi

According to the agency, about $260 billion of Russian assets have been frozen, but more widely accepted information suggests that the figure is $300 billion. More than 2/3 of them are blocked in the EU. These funds generate about $3 billion in profit per year.

The new EU bill proposes to use them to finance military and other assistance to Ukraine. If it is approved, this aid could arrive as early as July.

Approval of the bill requires the support of all EU member states.

Ukraine Facility

In February, the EU approved the Ukraine Facility, a €50 billion financing mechanism for Ukraine for the period 2024-2027. The programme consists of €17 billion in grants and €33 billion in loans. The mechanism provides not only for financing budgetary areas in Ukraine during the war, but also for programmes aimed at implementing the reforms that are essential for Ukraine’s accession to the EU.

The resolution emphasises that EU support should be directed in three areas:

1. Financial support for Ukraine to implement reforms and investments, and to maintain the country’s macro-financial stability, as envisaged in the Ukraine Plan to be developed by the Ukrainian government.
2. Ukraine’s investment framework to mobilise investment and increase access to finance.
3. Assistance on the path to European integration to mobilise technical expertise and build capacity.

Following the completion of all necessary European procedures, the first tranche of the Ukraine Fund is expected to arrive in Ukraine in March.

Delay in funding for US assistance

The US Congress has been unable to agree on a bill on military aid to Ukraine since autumn 2023. on 13 February, the Senate passed a bill that unblocks it. It provides assistance to Ukraine, Israel, and Taiwan totalling $95.34 billion, of which $61 billion is earmarked for Ukraine.

The bill now needs to be supported by the US House of Representatives, where Republicans are also refusing to vote for aid to Ukraine.

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