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G7 finalizes US$50 billion loan to Ukraine backed by frozen Russian assets – National

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The White House announced on Wednesday that Ukraine will receive loans worth $50 billion, backed by frozen Russian assets, from the Group of Seven. The funds will begin being distributed by the end of the year, according to US officials who said the United States would provide $20 billion of the total.

Leaders of the rich democracies agreed earlier this year to engineer the massive loan to help Ukraine in its fight for survival after the Russian invasion. Interest earned on profits from the frozen assets of the Russian Central Bank will be used as collateral.

US President Joe Biden said in a statement: “Ukraine can get the help it needs now, without burdening taxpayers. These loans will support the people of Ukraine as they defend and rebuild their country. “Our efforts make it clear that tyrants will be held accountable for the damage they cause.”

At a ceremony on Wednesday in Washington, Treasury Secretary Janet Yellen and Ukrainian Finance Minister Sergei Marchenko provided written assurances that the US loan would be repaid from windfall proceeds of frozen Russian sovereign assets, not from US taxpayer money.

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“Allowing Ukraine to fall would lead to further aggression by (Russian President Vladimir) Putin and jeopardize the safety of our NATO allies in Europe, whom we are committed to defending under the treaty,” Yellen said.


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Putin: The West’s theft of Russian assets will not go unpunished


The additional $30 billion will come from the European Union, the United Kingdom, Canada and Japan, among others.

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Canada announced in June when the loan was first announced at the G7 summit in Italy that it would contribute $5 billion to the initiative.

“To be clear, nothing like this has ever happened before,” said Dalip Singh, US deputy national security adviser for international economic affairs. “Never before has a multilateral coalition frozen the assets of an aggressor state and then harnessed the value of those assets to fund the defense of the affected party, all while respecting the rule of law and maintaining solidarity.”

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Singh said the Biden administration intends to divide the US share of $20 billion between aid to the Ukrainian economy and the military. It would take action from Congress to send military aid, and Defense Secretary Lloyd Austin said weapons and equipment promised now could take weeks or months to reach Ukraine.

The idea of ​​using frozen Russian assets to help Ukraine initially faced resistance from European officials who cited legal and financial stability concerns. The move gained momentum after more than a year of negotiations between financial officials and after Biden in April signed legislation allowing the government to seize nearly $5 billion in Russian state assets in the United States.

The G7 announced in June that most of the loan would be backed by profits earned from frozen Russian assets worth approximately $260 billion. The vast majority of this money is located in European Union countries.

The United States and its allies immediately froze any assets in the Russian central bank they had access to when Moscow invaded Ukraine in 2022.


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Canada urges the G7 to provide financial aid to Ukraine using confiscated Russian assets


The timing of the loan disbursement raised questions, because it comes about two weeks before the presidential elections between Republican Donald Trump and Democrat Kamala Harris. The candidates have taken opposing views on the Russian threat.

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Defense Secretary Lloyd Austin dismissed suggestions that military aid to Ukraine now approved by the Biden administration could be negated by any new team in office.

“I think we’re pretty confident that this material will continue to flow,” Austin said, adding that he is confident it will all be delivered “according to the timeline that we have set.”

However, Austin also made clear that the Biden administration is not wavering in its opposition to giving Ukraine the authority to use US-supplied ATACM missiles to strike deep into Russia.

He said the latest infusion of about $800 million in long-term aid will fund Ukraine’s production of drones that can strike farther than ATACMS, which has a range of about 300 kilometers (185 miles).

The World Bank’s latest assessment of the damage to Ukraine, released in February, estimates reconstruction and recovery costs at $486 billion over the next 10 years.

Associated Press writer Lolita C. contributed to this report. Additional files from international news


& Edition 2024 The Canadian Press





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