The Biden administration announced Tuesday that it has distributed $20 billion in loans to Ukraine that will be recouped from profits generated by “immobilized” Russian assets.
“These funds – paid for by the windfall proceeds earned from Russia’s own immobilized assets – will provide Ukraine a critical infusion of support as it defends its country against an unprovoked war of aggression,” Treasury Secretary Janet Yellen said in a statement.
The distributed funds are part of a $50 billion loan initiative agreed to by the leaders of the Group of Seven countries earlier this year to support Ukraine’s “budgetary, military and reconstruction assistance.”
Under the terms of the agreement, the US, Canada, France, Germany, Italy, Japan and the United Kingdom will each provide a sizable loan to war-torn Ukraine that will be recovered through profits produced by roughly $280 billion in frozen Russian assets, which are largely in Europe.
“The $50 billion collectively being provided by the G7 through this initiative will help ensure Ukraine has the resources it needs to sustain emergency services, hospitals, and other foundations of its brave resistance,” Yellen said.
“Together with America’s security assistance to Ukraine and the steps we will continue to take to decisively tighten sanctions on Russia, this action will further position Ukraine to defend its sovereignty and achieve a just peace,” she added.
“Right now, [Russian President Vladimir Putin] is engaging our coalition in a contest of wills, counting on us to tire and ultimately retreat. But, through creative policymaking and the unity of the G7, we are sending an unmistakable message of resolve by making Russia increasingly bear the costs of its illegal war, instead of taxpayers in our coalition.”
The Biden administration has tasked the World Bank with distributing the mega loan to Ukraine.
Ukrainian President Volodymyr Zelensky said he was “deeply grateful” to President Biden and Yellen for the financing.
“This critical support, funded by immobilized Russian assets, will strengthen Ukraine’s defense and help protect our sovereignty and people against unprovoked aggression,” Zelensky wrote on X.
“This decision is a powerful act of justice,” he added. “By utilizing Russia’s assets to support Ukraine, the G7 is holding the aggressor accountable.”
“This sends a clear and resolute message: Russia must pay for its brutal war, Putin’s regime must face the consequences of its violations of international law, war crimes, and assault on democracy.”
The loan announcement comes less than six weeks before President-elect Donald Trump takes office.
The 45th president has pledged to bring peace to Ukraine quickly upon returning to the Oval Office.
Trump, 78, suggested back in February that any US aid going to Ukraine should be in the form of a loan.
