EU transfers €1.5Bln to Ukraine using frozen Russian assets
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The first transfer amount increased from €1.4 billion to €1.5 billion due to interest rate variations.
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Ukrainian flag photographed in Lisbon, Thursday, July 11, 2024 (AP)
On Friday, the EU sent €1.5 billion to Ukraine, marking the first transfer under a new scheme utilizing Russia's frozen assets, which is estimated at €210 billion across the bloc, Euro News reports.
Ninety percent of this financial aid will fund weapons, ammunition, and air defense systems for Ukraine, while the remaining 10% will support reconstruction, particularly of the energy infrastructure damaged by Russian strikes.
The initiative reportedly intends "to prevent a humanitarian crisis and migration surge" due to power grid destruction.
Read more: EU to release 1.4Bn euros in military aid to Kiev from Russian assets
Months in the making, the scheme overcame Hungary's initial opposition by finding a legal workaround.
The first transfer amount increased from €1.4 billion to €1.5 billion due to interest rate variations.
Unlike previous aid through the European Peace Facility (EPF), this €1.5 billion will be wired directly into Ukraine's budget.
The EPF has been stalled by Hungary, blocking €6.5 billion, leading the EU to collaborate with the US on a $50 billion loan to Ukraine using frozen assets as collateral.
The EU is considering options to ensure the assets remain frozen until Russia compensates Ukraine or by renewing sanctions for longer periods.
Discussions on the options will continue after the summer break, requiring unanimity among member states, the report notes.
Read more: Russia to defend its interests if its assets were seized: Kremlin
On June 20, Russian Foreign Ministry spokesperson Maria Zakharova said that Russia possesses a "wide arsenal" of economic and political countermeasures if the West seizes its sovereign assets, including a tit-for-tat confiscation of Western assets in Russia.
Zakharova highlighted that Russia has a substantial amount of Western assets, including funds and property, under its governance, warning that they could all be subject to seizure as part of the Russian response.
"All of it may be subject to Russian retaliatory policy and retaliatory actions. The arsenal of political and economic countermeasures is wide," she said, without revealing the nature of the possible retaliatory actions.
