US close to approving up to $20 billion in G7 loan for Ukraine

US Treasury Secretary Janet Yellen stated on Tuesday that the United States is "very close" to finalising the allocation of US$20 billion as part of the G7 credit package for Ukraine, which will be funded through revenues from frozen Russian assets.

According to Politico, Yellen highlighted that "we’re 99% there", with only a few relatively minor issues left to resolve. "We are very close," Yellen told reporters. 

The US and its allies have been trying to finalise the details of a US$50 billion credit package since leaders reached an agreement during the G7 meeting in June. The deal, struck after Yellen and other Biden administration officials rallied sometimes reluctant allies around the idea, stipulated that Ukraine would receive the funds by the end of the year. 

Yellen stated that this deadline remains the goal. The loan provides G7 countries with the opportunity to ensure long-term funding for Ukraine's military efforts and to insulate these funds from the outcomes of the US presidential elections.

Reports indicated that the US is prepared to provide Ukraine with up to US$20 billion as part of the G7 loan. Until recently, it was expected that Washington's contribution would be less than initially planned, as the EU, due to Hungary's resistance, failed to implement a safeguard guaranteeing that Russian assets would remain frozen for at least three years. However, Washington has softened its stance.

On Tuesday, the European Parliament approved the EU's contribution to the loan amounting to €35 billion (approximately US$38 billion), although this share is expected to decrease after the US makes its contribution. 

The UK separately approved its contribution of around US$3 billion.