G7 to announce new steps about using frozen Russian assets to support Ukraine

The United States has said that the G7 leaders will announce assistance to Ukraine at this week's summit based on the use of frozen Russian assets.

Bloomberg  with reference to John Kirby, National Security Council Coordinator for Strategic Communications at the White House, noted that this statement might indicate that the G7 leaders had almost agreed on a deal to announce a loan of about US$50 billion, which would be paid from the proceeds of Russia's frozen assets.

"We will announce new steps to unlock the value of the immobilized Russian sovereign assets to benefit Ukraine and help them recover," Kirby noted.

Kirby did not confirm that the G7 countries had reached a full agreement and refrained from giving details, but made it clear that he expected an agreement between the countries.

"You’re going to see unanimity here at the G-7 when it comes to working towards using these frozen assets to help Ukraine with their reconstruction," he said.

Bloomberg reported that the political agreement to be announced this week might leave some details for further negotiations.

One of the key technical aspects that is likely to be settled later is how the risks will be shared between the countries.

The funds are expected to support Ukraine in the medium term, and, as unnamed agency officials put it, they will help cover Ukraine's financial needs in 2025 and beyond.

One US official, speaking on condition of anonymity, said that proceeds from frozen assets in Europe were estimated to be between €3 billion and €5 billion annually, depending on interest rates and other factors.

This official also stressed the US hoped that the deal could be passed in a way that avoids the need for congressional approval. The money could be available later this year, he added.

It became known earlier that the G7 leaders still hoped to reach an agreement on the use of the proceeds of frozen Russian assets to help Ukraine at the summit in mid-June, but had not yet reached a consensus.

The US proposal envisaged that the G7 countries would provide Ukraine with a US$50 billion loan to be paid from the proceeds of Russia's frozen assets.

Instead, the European Union put forward an alternative proposal, according to which it would provide a loan for Ukraine, using its seven-year budget of €1.2 trillion as collateral. EU countries have not decided which of these proposals to support.