The European Union is pressing ahead with a plan to use the profits generated from billions of euros of Russian assets frozen in Europe to help provide weapons and other funds for Ukraine, a senior official said Tuesday. EU foreign policy chief Josep Borrell got a green light for the plan from most of the bloc’s foreign ministers this week, and he hopes that EU leaders will endorse it at a summit in Brussels starting on Thursday. The move comes as Ukraine runs dangerously low on munitions, and U.S. efforts to get new funds for weapons have stalled in Congress.
Quick Read
- The EU is advancing a plan to use profits from frozen Russian assets, around 200 billion euros, to support Ukraine, particularly for weapons and funding.
- EU foreign policy chief Josep Borrell received approval from most EU foreign ministers and seeks endorsement at an upcoming summit in Brussels.
- The interest from these assets could yield about 3 billion euros annually, which Borrell notes would upset Russia but is significant for aiding Ukraine.
- Due to some EU members’ reluctance to supply weapons to Ukraine, 90% of the funds will go to a special reimbursement fund for arms, and 10% to the EU budget to strengthen Ukraine’s defense industry.
- The plan avoids using the EU budget for arms purchases, aligning with the European Peace Facility’s off-budget operations, not bound by the same legal or parliamentary approvals.
- The European Central Bank has been consulted to mitigate concerns about impacting the euro and EU markets, ensuring only profits, not assets, are used.
- Some EU leaders prefer using these profits for Ukraine’s reconstruction, but Borrell emphasizes prevention over rebuilding post-destruction.
The Associated Press has the story:
EU pushes ahead with a plan to buy weapons for Ukraine with frozen Russian asset profits
Newslooks- BRUSSELS (AP) —
The European Union is pressing ahead with a plan to use the profits generated from billions of euros of Russian assets frozen in Europe to help provide weapons and other funds for Ukraine, a senior official said Tuesday.
EU foreign policy chief Josep Borrell got a green light for the plan from most of the bloc’s foreign ministers this week, and he hopes that EU leaders will endorse it at a summit in Brussels starting on Thursday. The move comes as Ukraine runs dangerously low on munitions, and U.S. efforts to get new funds for weapons have stalled in Congress.
The 27-nation EU is holding around 200 billion euros ($217 billion) in Russian central bank assets, most of it frozen in Belgium, in retaliation for Moscow’s war against Ukraine. The bloc estimates that the interest on that money could provide around 3 billion euros ($3.3 billion) each year.
“The Russians will not be very happy. The amount of money, 3 billion per year, is not extraordinary, but it is not negligible,” Borrell told reporters.
A small group of member countries, notably Hungary, refuse to supply weapons to Ukraine, so these windfall profits would be divided up. Around 90% of the money would be put into a special fund that many EU countries already use to get reimbursed for arms and ammunition they send.
The other 10% would be put into the EU budget to help bolster Ukraine’s defense industry. Countries that object to sending weapons could then claim that they are not arming the country, Borrell said.
The EU budget can’t be used to buy arms, under current expert interpretations of the bloc’s treaties, but the special fund — known as the European Peace Facility — runs off-budget and doesn’t have to respect the same legal standards or be approved by the European Parliament.
The European Central Bank, or ECB, has warned in the past against seizing Russian assets as this could undermine confidence in the euro currency and EU markets. But Borrell said that no assets would be taken, only the windfall profits they make. He added that the ECB has been consulted on the plan.
Some EU leaders, including Belgian Prime Minister Alexander De Croo, have said that they want to use the windfall profits to fund Ukraine’s reconstruction, but Borrell said he believes that “the best thing is to avoid that anything is destroyed” in the first place.
