The leaders of the Group of Seven (G7) wealthy democracies have agreed to offer a $50 billion loan to assist Ukraine in its conflict with Russia. This agreement, reached at a summit in Italy’s Apulia region, utilizes profits from frozen Russian central bank assets as security.
The loan, dubbed the “Extraordinary Revenue Acceleration (ERA) Loans for Ukraine,” is intended to aid Ukraine’s military, budget, and reconstruction efforts. It is anticipated that the funds will be accessible by the year’s end.
Ursula von der Leyen, President of the European Commission, stressed that the financial responsibility would rest on Russia rather than European taxpayers.
A senior official from the United States mentioned that the loan would involve several lenders sharing the risk, though each country’s contribution is yet to be determined. The next steps involve gaining approval from EU member states and finalizing contracts among lenders, Ukraine, and intermediaries.
Ukrainian President Volodymyr Zelenskyy hailed the agreement as a significant stride in securing sustainable support for Ukraine. President Joe Biden hailed the decision as a “historic agreement.”
Most of the frozen Russian assets, approximately $260 billion, are located within the European Union, with additional contributions expected from Canada, Japan, and other European nations. The World Bank may also assist in distributing the US portion of the loan.