Germany backs EU proposal to use frozen Russian assets to finance arms for Ukraine
German Chancellor Olaf Scholz says the revenue accrued from Russian assets frozen by the European Union should be allocated for weapons purchases for Ukraine.
Backing EU's previous suggestion of utilizing the interest revenues from Russian assets to enhance Ukraine's military capabilities, Scholz said on Monday that 90% of the income derived from frozen Russian assets should be allocated towards acquiring arms for Kiev.
"It is important that we also agree that this money can be used for arms purchases not only in the EU, but for purchases worldwide," Scholz told journalists after a meeting with members of the three Baltic governments of Estonia, Latvia, and Lithuania in Riga.
In February 2022, as Russia launched the Ukraine war, the United States and its allies prohibited transactions with Russia’s central bank and finance ministry and the Russian assets in the West worth approximately $300 billion were blocked by the US and its allies. However, rather than confiscating the funds entirely, the EU suggested redirecting the interest towards Kiev.
Scholz endorsed the proposal made by Josep Borrell, the EU foreign policy chief, who suggested in March to transfer 90% of the revenues from Russian assets frozen in Europe to an EU-managed fund that supports the provision of weapons to Ukraine.
He further said that Germany along with the three Baltic states want to see a ramp-up of weapons production in the EU.
Over the past two years, the US and its allies have committed billions of dollars in military and financial assistance to Kiev, emphasizing the importance of Moscow experiencing a "strategic defeat" in the conflict, while denying any direct involvement in the conflict.
Around 70% of Russian assets frozen in Western countries are held in Euroclear, a Belgian-based securities depository, which has the equivalent of approximately $204 billion worth of Russian central bank securities and cash.
Moscow has repeatedly denounced the confiscation of Russian assets as “theft”, asserting that it constitutes expropriation and a breach of international law.
Dmitry Peskov, the Kremlin spokesperson, has said that Russia is determined to take all necessary measures to reclaim the seized assets.
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