The EU sets a condition for allocating €140 billion to help Ukraine from Russian assets

RBC: EU plans to allocate money for Ukraine from Russia’s frozen assets

The European Commission plans to allocate €140 billion from frozen Russian assets to help Ukraine, but for this it is necessary to create a legal structure that allows for the “permanent immobilization” of funds. Writes about this RBC with reference to the Financial Times. The EC document states that funds must remain frozen beyond the standard six-month extension period.

The document was sent to EU countries ahead of the December leaders’ summit. It emphasizes that if the plan to use part of the funds blocked in the Belgian Euroclear depository does not materialize, the countries will face a choice: either jointly borrow the funds, which will create new budget obligations, or allocate €140 billion in direct grants to Ukraine.

According to the European Commission, both options could require adjustments to national budgets and affect deficits and debt. The cost of servicing the joint loan could amount to up to €5.6 billion per year, of which France will pay about €1 billion, Italy – €675 million, and Belgium – almost €200 million.

Previously Belgium refused support the release of funds from Russian assets, explaining this as a risk to the economy and a threat to confidence in Euroclear. Moscow responded by stating that any actions with its foreign assets would be considered “theft.” Also in the Kremlin notedthat the 2022 UN General Assembly resolution on Russian compensation for damage to Ukraine is not legally binding and in fact represents an attempt to “commit robbery.”