EU Agrees on Use of Frozen Russian Assets to Aid Ukraine

In a pivotal decision with far-reaching implications, European Union ambassadors have reached a consensus on the management of frozen Russian assets, paving the way for substantial support to be directed towards Ukraine. The agreement, announced by the Belgian Presidency of the Council of the EU, outlines the conditions under which interest accrued from these assets will be utilized for the benefit of Ukraine.

The text of the regulation awaits final approval by the Council, with the European Commission indicating that access to the funds could be granted as early as July. According to the agreed-upon terms, a significant portion - 90 percent - of the proceeds will be allocated to an EU-administered military aid fund for Ukraine. The remaining 10 percent will be designated to support Kyiv in other areas of need, as reported by four diplomatic sources to Reuters.

The decision comes against the backdrop of escalating tensions between Russia and Ukraine, with the former facing severe economic sanctions imposed by Western allies in response to its aggression. In 2022 alone, financial assets belonging to Russia, totaling approximately 300 billion USD, were frozen by Ukraine's allies. Since then, efforts have been underway to find a legal framework that would allow for the utilization of these funds without provoking retaliatory action from Russia once the conflict subsides.

While the United States advocated for the seizure of the assets in their entirety, European leaders opted for a more cautious approach, citing concerns over potential destabilization of the euro and legal ramifications. Instead, Washington has proposed using the assets as collateral for loans to Ukraine, a suggestion met with resistance from European counterparts.