The European Union has released 1.5 billion euros from interest earnings on frozen Russian assets for Ukraine's defense and reconstruction. The funds will be transferred to Ukraine to make Europe a safer place to live.
The money comes from interest earnings, not the assets themselves. About 90% of the frozen funds are held by Euroclear.
Ukrainian Prime Minister Denis Schmyhal thanked the EU for their support, while Kremlin spokesperson Dmitry Peskov called the action illegal. The funds were frozen as part of sanctions imposed on Russia due to the war in Ukraine.
EU Commission President Ursula von der Leyen stated that the money is a symbol of holding Russia accountable. In May 2022, EU member states agreed to use interest earnings for Ukraine.
The EU has released 1.5 billion euros from 210 billion euros of frozen Russian central bank funds, with 4.4 billion euros in interest earnings in 2023. 90% of the earnings will be used for military equipment and training, 10% for direct financial assistance to Ukraine.
The EU is not planning for direct expropriation due to legal concerns and possible retaliatory measures. Kremlin spokesperson Dmitry Peskov announced that Russia will respond to this step.
The G7 is working on a $50 billion loan to Ukraine, backed by $300 billion in frozen Russian central bank assets, with an expected framework deal by October and market access by year end.
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