European Commission President Ursula von der Leyen announced the transfer of 1.5 billion euros. “There is no better symbol or purpose for Kremlin money than making Ukraine and all of Europe a safer place to live,” she wrote on the X platform.
The money in question is interest income from the frozen assets of the Russian central bank. Due to the Russian attack on Ukraine, the European Union froze more than 200 billion euros from the Russian central bank. The decision to transfer it to Ukraine was made by the EU in the spring of this year. The money will now flow to countries such as Germany and the Czech Republic, which will soon use it to supply Ukraine with air defense equipment or artillery missiles.
Russia’s assets frozen. Ukraine to receive interest income
According to the European Commission, some €210 billion from the Russian central bank is frozen in the EU. Brussels-based financial institution Euroclear recently announced that it had earned around €4.4 billion in interest on Russian assets in 2023.
The proposal to indirectly use Russian funds to help Ukraine was presented to member states by Commission President von der Leyen and EU High Representative for Foreign Affairs and Security Policy Josep Borrell in March. It envisages that 90 percent of the interest income that can be used from holding Russian central bank funds will be transferred to an EU fund to finance military equipment and training. The remaining 10 percent is to be used for direct financial assistance to Ukraine.
Russia reacts strongly to EU decision. Dmitry Peskov: This is expropriation
There are currently no plans to use the Russian central bank’s funds directly through an expropriation order. One reason is legal concerns and the likelihood of retaliatory action. Moscow warned the EU last year against confiscating property belonging to the Russian state or Russian citizens.
For example, in retaliation, EU companies operating in Russia could be forcibly expropriated. Furthermore, direct use of Russian assets could lead to a loss of confidence in the European financial centre by other countries and investors and a withdrawal of assets from the EU.
The Kremlin criticized EU plans to use interest income from frozen Russian assets for Ukraine in May as “expropriation.” Kremlin spokesman Dmitry Peskov said at the time that Brussels had chosen a “shortened version” of its actions against Russia, focusing only on interest. “But even this shortened version is nothing more than expropriation,” he added.
Russia responded to the transfer of money to Ukraine with a warning. According to Peskov, there will be no immediate reaction, but “of course, such steps of the European Commission will not remain unanswered,” he announced.
(DPA/stef)
Source: Gazeta
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