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Austrian chancellor opposes profits from frozen Russian assets being used to buy weapons for Ukraine

by Nate Ostiller and The Kyiv Independent news desk March 21, 2024 3:44 PM 2 min read
Austria's Chancellor Karl Nehammer in Munich, Germany, on Sep. 12, 2023. (Christof Stache/AFP via Getty Images)
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Austrian Chancellor Karl Nehammer said on March 21 that he is opposed to the idea that profits from frozen Russian assets be used to buy weapons for Ukraine.

The European Commission has proposed to use 90% of the profits to purchase weapons for Kyiv and allocate the remaining 10% to the EU budget to support Ukraine's defense industry. The proposed measure would allocate around 3 billion euros ($3.3 billion) to Ukraine per year.

Ukraine's Western partners and other allies froze around $300 billion in Russian assets at the start of the full-scale invasion in 2022, with roughly two-thirds held at the Belgium-based financial services company Euroclear.

While some leaders, such as German Chancellor Olaf Scholz and Belgian Prime Minister Alexander De Croo, backed the idea, Nehammer publicly voiced opposition to the proposal.

"For us neutral (countries), it must be ensured that money, for which we give our approval, is not spent on weapons and ammunition," he said.

Vienna has denounced Russian aggression against Ukraine and provided Kyiv with economic and humanitarian aid but refused to donate lethal military assistance due to its neutrality policy.

Austria also has close and long-standing economic ties with Russia. The Austrian Raiffeisen Bank International has not left Russia despite sanctions and is one of two foreign banks classified as "systemically important" by the Russian central bank.

Reuters: Ukraine refuses to remove Austrian Raiffeisen bank from ‘sponsors of war’ list
Ukraine’s National Agency on Corruption Prevention (NACP) has refused to remove Austria’s Raiffeisen Bank from the international sponsors of war list, citing the bank still not having a clear plan to leave the Russian market, Reuters reported on Feb. 15.
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