The EU will consider a project on the transfer of income from assets under sanctions to Kiev

The European Commission plans to create a fund "RebuildUkraine" to restore Ukraine. As part of this initiative, the EC will offer to send there income from the European assets of Russian businessmen against whom sanctions were imposed.

The European Commission will consider a project on the use of income from the frozen assets of Russian businessmen who fell under EU sanctions to restore Ukraine. This is reported by Bloomberg with reference to the corresponding project.

According to the document, the EC will propose an updated financial strategy on May 18 to help cover Ukraine's $15 billion deficit over the next three months.

The commission, among other things, will offer to create a fund called "RebuildUkraine", where all resources will be directed to the restoration of Ukraine in the future. As part of this initiative, the EU will consider using proceeds from confiscated assets from Russian individuals who have been sanctioned since the start of the special operation in Ukraine.

In addition, according to Bloomberg sources, the EC will offer Kyiv loans ranging from €7 to €9 billion to finance urgent government bills as part of this package.

Borrell urged to transfer Russia's reserves frozen in the EU to Ukraine Politics

Since the beginning of the Russian military operation in Ukraine, hundreds of businessmen, officials and military from Russia have been sanctioned by the European Union: their assets and accounts have been frozen, and they have been banned from entering the EU.

On May 9, head of European diplomacy Josep Borrell urged the EU to consider withdrawing Russia's frozen foreign exchange reserves to also help pay for the costs of Ukraine's post-conflict reconstruction. Borrell cited "billions of dollars" worth of assets seized by the United States from the Central Bank of Afghanistan, which he said would later be used to compensate victims of terrorism and to provide humanitarian assistance to the country. The diplomat noted that "it would be logical" to consider similar steps with Russia's frozen reserves.

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According to the Central Bank, as of April 1, 2022, the volume of Russia's international reserves amounted to $606.5 billion. The Ministry of Finance previously reported that after the outbreak of hostilities, Western countries froze about half of Russia's gold and foreign exchange reserves (about $300 billion). At the same time, assets in Chinese yuan, monetary gold stored in Russia (as of February 1, about $132 billion), cash reserves and special drawing rights (SDR, about $24 billion) in the IMF remain legally inaccessible to sanctions.

Earlier, Ukrainian Prime Minister Denys Shmygal said that the frozen Russian reserves should be transferred to Ukraine. “We have these negotiations [on the withdrawal of Russian reserves] with the United States, with all our partners,” he said. President of Ukraine Volodymyr Zelensky in early May estimated the cost of restoring the country after the Russian special operation at $600 billion.