The US has proposed to its allies in the G7 that they use frozen Russian assets to fund a financial scheme that would help finance Ukraine’s defence from the Russian invasion.
According to Bloomberg, the plan is to combine $280 billion of assets frozen by the G7 and the European Union and use it to capitalise a Special Purpose Vehicle. The proceeds would back ‘freedom bonds’. The bonds would potentially raise as much as $50 billion a year.
Ukraine has been faced with a serious dilemma, as its war effort has been flagging amid failing financial support from its allies.
The EU has already been investigating how the profits of frozen Russian assets can be used to assist Ukraine.
The proposal for freedom bonds is under discussion, although some G7 members are reticent to go this route.