EC Backs Plan To Transfer Profits From Frozen Russian Assets To UKR

The European Commission has formalised a proposal to use frozen Russian sovereign assets to fund Ukraine's war effort. The proposal would transfer roughly 90% of the profits from the frozen assets - estimated at roughly USD$4.0-4.5 billion p/year - to the European Peace Facility fund to procure weapons.

• The proposal falls short of US calls to seize the assets in their entirety, but will partially plug a Ukraine funding shortfall created by gridlock in the US Congress.
• EC Executive Vice President Valdis Dombrovskis said: "Our proposal will redirect substantial windfall revenues from frozen Russian state assets for the benefit of Ukraine and its people, to the tune of up to 3 billion euros a year."
• Reuters notes the asset, "are held by EU central securities depositories, mainly Belgium's Euroclear, which will keep 3% for operational expenses and temporarily retain 10% of the profits as a safeguard against legal action by Russia."
• In the US, some Democrats have tentatively supported a Republican proposal, backed by former President Donald Trump and championed by Senator Lindsay Graham (R-SC), to restructure some aid to Ukraine into loans.
• Senator Chris Coons (D-DE), a close ally of President Biden, said the situation, “is so urgent … that if instead of grant money, we give the budget support as loans that are written in the same way that the European development loans are... I’d support it. Because, bluntly, we’ve got to get this done.”