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EU to start transfer of profits from frozen Russian assets 'before summer break,' EU official says

by Elsa Court and The Kyiv Independent news desk June 21, 2024 5:42 PM 2 min read
European Commissioner for Trade Valdis Dombrovskis speaks during a press conference in Brussels on June 7, 2023. (Kenzo Tribouillard/AFP via Getty Images)
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Ukraine will receive the first payment of 1.5 billion euros ($1.6 billion) from the profits of Russian assets frozen in the EU "before the summer break," EU Trade Commissioner Valdis Dombrovskis said on June 21.

While Dombrovskis did not specify when exactly Ukraine would receive the funds, EU institutions typically take a summer recess from the end of July until the beginning of September.

EU ambassadors agreed on May 8 on a plan to use windfall profits of immobilized Russian assets to fund Ukraine's reconstruction and defense needs. Kyiv is expected to receive roughly 3 billion euros ($3.2 billion) every year, according to earlier discussions.

"We estimate that our measures would make up to 3 billion euros ($3.2 billion) available this year, and we expect to make a first payment of 1.5 billion euros ($1.6 billion) before the summer break," Dombrovskis said.

Dombrovskis said he also welcomed the deal made at the G7 to provide $50 billion of loans for Ukraine using revenues from frozen Russian sovereign assets.

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

While some G7 members, like the U.S., proposed seizing Russian assets outright, the EU has been more hesitant, fearing legal and fiscal pitfalls of confiscation. Instead, Brussels seeks to use windfall profits generated by the frozen assets and funnel them to Kyiv.

The costs of Ukraine's reconstruction also continue to rise, amounting to $486 billion over a 10-year period, according to the World Bank's report from February.

EU Council confirms accession talks with Ukraine, Moldova to start on June 25
The announcement follows an agreement by EU ambassadors from last week. Officials in both Kyiv and Brussels were pushing for the June starting date before Hungary takes over from Belgium in chairing the EU.

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