ARTICLE
Britain ‘prepared to loan Ukraine all frozen Russian central bank assets in UK’
Patrick Wintour
3-6-2024 Updated 05.40 EST
Britain is prepared to loan Ukraine all frozen Russian central bank assets in the UK on the basis that Russia will be forced to pay reparations to Ukraine at the end of the war, the UK foreign secretary David Cameron has said.
He said the assets would be used as surety for the payment of the reparations.
The plan is more radical than proposals discussed in the European Union for Ukraine to be given only the windfall profits from the Russian central bank assets being held by the West. The annual windfall profits are estimated at $4bn.
Cameron told peers on Tuesday night:
There is an opportunity to use something like a syndicated loan or a bond that effectively uses the frozen Russian assets as a surety to give that money to the Ukrianians knowing that we will recoup it when reparations are paid by Russia. That may be a better way of doing it. We are aiming for the maximum amount of G7 and EU unity on this but if we cannot get it I think we will have to move ahead with allies that want to take this action.
Cameron said he did not think the bond plan would undermine the reputation of the City of London in any way.
It is the first time Cameron has spoken about the proposal openly in such detail, and probably underscores the political support the plan has in the US, but not the EU.
The plan would be especially helpful to Ukraine if the US Congress continues to block an extension of aid to Ukraine since it would provide Ukraine with a new source of funds to buy armaments, and fund its budget deficit.
The G7 has been debating for over a year whether the Russian central bank assets frozen at the time of the Russian invasion of Ukraine could also be seized without undermining faith in the international financial system.
The EU estimates around €260bn in Central Bank of Russia assets have been immobilised in the form of securities and cash in the jurisdictions of the G7 partners, the EU and Australia, with more than two-thirds of those immobilised in the EU.
Belgium is thought to have control of as much as 190bn of the assets, housed in its Euro clear financial clearing house, and is the most reluctant to follow the kind of radical plan set out by Cameron. It says it is already facing a series of court cases mainly in Russia, and its stance has the backing of France and Germany.
The US Treasury, initially reluctant to seize Central Bank assets due to the assumed sanctity of sovereign state assets, has warmed to the idea of a bond. The US is estimated to have $40 to $60bn worth of Russian assets, and the UK closer to £25bn, but no official figure has been disclosed.
The strength of the proposal is that seized assets would be deemed to have been returned to Russia after the payment of reparations. The proposal’s weakness is that it assumes Ukraine will win a military victory and a defeated Moscow will be prepared to pay reparations for the damage it caused to Ukraine, something that now seems unimaginable.
Vladimir Putin has already retaliated by seizing the assets of some US companies operating in Russia.
It is estimated Ukraine needs €100bn a year to fight off the Russian invasion, and another €50bn a year for reconstruction.
Similar appropriations of state assets have happened before, most notably the UN-sanctioned US seizure of billions of dollars of Iraqi funds that were earmarked for reparations for Kuwait in the after the 1990 invasion. Russia would veto any UN move to endorse seizure of its assets
The foreign secretary said he did not think the Russian President Vladimir Putin would stop at Ukraine, saying“ if we allowed Russian any form of win in Ukraine Moldova would be at risk and some of the Baltic states would be at risk.”
And, if we allow the assets of Russians to be stolen, it will result in backlash hurts our economy and the dollar.
Doing so is the equivalent of what the state of New York is trying with Trump. There will be severe consequences.
“The US Treasury, initially reluctant to seize Central Bank assets due to the assumed sanctity of sovereign state assets, has warmed to the idea of a bond. The US is estimated to have $40 to $60bn worth of Russian assets, and the UK closer to £25bn, but no official figure has been disclosed.”
The Russians ‘forced us’ (Indian drug companies, etc.) to make cheap knockoffs of Western patented products.
Zelensky, the Gay/Actor/President is just as Corrupt as Putin.
The day NATO sends American Troops to Ukraine, all hell will break loose.
If the UK and other EU Countries want to send their sons and daughters
to War with Ruzzia have at it.
——Britain is prepared to loan Ukraine all frozen Russian central bank assets in the UK on the basis that Russia will be forced to pay reparations to Ukraine at the end of the war, the UK foreign secretary David Cameron has said.——
There you have it. Cameron ahs been reading bert’s posts on Free Republic