The UK is ready to loan Ukraine all the frozen assets of Russia's central bank. This is possible because Russia will be forced to pay reparations to Ukraine after the war is over, Foreign Secretary David Cameron said. The assets could be used as a guarantee of reparations, The Guardian quoted him as saying.
The plan is more radical than proposals discussed in the European Union for Ukraine to be given only the windfall profits from the Russian central bank assets being held by the West. The annual windfall profits are estimated at $4bn.
"There is an opportunity to use something like a syndicated loan or a bond that effectively uses the frozen Russian assets as a surety to give that money to the Ukrianians knowing that we will recoup it when reparations are paid by Russia. That may be a better way of doing it. We are aiming for the maximum amount of G7 and EU unity on this but if we cannot get it I think we will have to move ahead with allies that want to take this action," Cameron told his colleagues on the evening of 5 March.
Cameron said he did not think the bond plan would undermine the reputation of the City of London in any way.
It is the first time Cameron has spoken about the proposal openly in such detail, and probably underscores the political support the plan has in the US, but not the EU.
- During the two years of full-scale war, Brussels has not dared to transfer frozen assets to Russia. However, there is progress on the issue of transferring the profits from these assets to Ukraine - recently, European Commission President Ursula von der Leyen proposed to start discussing how these funds could be used to start joint arms purchases for Ukraine.
- Foreign Minister Dmytro Kuleba explained that the frozen assets in Germany ($6.5 billion), Austria ($1.8 billion), Ireland ($2 billion) and Poland ($1.13 billion) would be enough to help rebuild more than 3,500 damaged or destroyed educational institutions, including 1,700 schools, more than 1,000 kindergartens and 586 universities. Russia has assets worth 23 billion in the UK.
- The Ukrainian government believes that Russia's frozen assets can serve as a reliable source of support for Ukraine and funding for reconstruction.
- So far, only Belgium is ready to transfer the proceeds of frozen assets to Ukraine.