The EU makes loan-free payments from Russian assets for Ukraine
Ukraine needs weapons in its defense against Russia above all. The EU is now releasing funds from frozen Russian regime assets for the first time. This money is intended to pay for missile defense and artillery shells.
The EU is releasing interest payments from frozen Russian state assets for Ukraine's defense and reconstruction. EU Commission President Ursula von der Leyen announced a transfer of 1.5 billion Euros. "There is no better symbol or better use for the Kremlin's money than making Ukraine and all of Europe a safer place to live," she wrote on social media X.
The money in question are interest payments from the Russian Central Bank's assets in the EU. Using this money for Ukraine was already decided in principle by the EU in the spring. The money is now being transferred to countries like Germany or the Czech Republic, which then provide Ukraine with equipment for missile defense or artillery shells.
According to EU Commission statements, approximately 210 billion Euros of the Russian Central Bank's assets are frozen in the EU. The Brussels-based financial institution Euroclear recently reported having earned around 4.4 billion Euros in interest in 2023.
90 Percent of the Interest for Military
Commission President von der Leyen and EU Foreign Policy Chief Josep Borrell made the proposal to use Russian funds for Ukraine to EU member state governments in March. They propose that 90 percent of the usable interest earnings from the custody of Russian Central Bank assets in the EU be directed to EU funds for the financing of military equipment and training. The remaining ten percent are intended for direct financial aid for Ukraine.
Using Russian Central Bank assets through an expropriation decree is not currently planned. Legal concerns and likely retaliatory measures are cited as reasons. Moscow had already warned the EU the previous year against confiscating the property of the Russian state or its citizens. It is conceivable that active companies from EU countries could be forcibly expropriated in Russia. Furthermore, direct use of Russian financial assets could lead to other states and investors losing trust in the European financial center and withdrawing assets from the EU.
The Kremlin criticized EU plans to use interest from frozen Russian assets for Ukraine's benefit as "expropriation" in May. Moscow spokesman Dmitri Peskov said then that Brussels had opted for a "sanitized version" in its actions against Russia by focusing only on the interest, but that this was still "nothing more than expropriation."
The European Union is utilizing interest payments from frozen Russian Central Bank assets for funding missile defense and artillery shells in Ukraine, as stated by EU Commission President Ursula von der Leyen. The funding for Ukraine's defense and reconstruction comes from the European Union, following the EU's decision made in the spring. The proposal by von der Leyen and EU Foreign Policy Chief Josep Borrell suggests that 90% of the usable interest earnings from the Russian Central Bank's assets be directed towards EU funds for financing military equipment and training.
