G7 leaders agree to loan $50 billion to Ukraine
The Group of Seven (G7) leaders have agreed to lend Ukraine around $50 billion. The money, guaranteed by earnings from frozen Russian sovereign assets, will be disbursed as soon as December. The process will continue until 2027. The decision was announced during the annual meetings of the International Monetary Fund and World Bank in Washington.
Loan disbursement and repayment details unveiled
The funds will be distributed through a series of bilateral loans, given Ukraine's urgent financing needs. "These loans will be serviced and repaid by future flows of extraordinary revenues stemming from the immobilization of Russian Sovereign Assets," the G7 statement said. The US has pledged a $20 billion loan in December, while another $20 billion is anticipated from the European Union. Canada, Britain, and Japan will split the remaining $10 billion.
Loans to support Ukraine's budgetary, military, and reconstruction efforts
The loans will help Ukraine's budgetary, military, and reconstruction efforts. They will be routed through various means, including a Macro-Financial Assistance Loan from the EU and a newly created Financial Intermediary Fund for Ukraine at the World Bank. G7 leaders have reiterated their commitment to supporting Ukraine's fight for freedom and reconstruction. The G7 statement said, "We will stand by Ukraine for as long as it takes," reiterating their resolve against Russian aggression.
G7's financial package follows agreement to utilize frozen Russian assets
This financial package comes after an agreement during the G7 summit in southern Italy in June to use frozen Russian assets for supporting Ukraine. Around €260 billion in Russian assets were frozen under sanctions after Russia invaded Ukraine in February 2022. US President Joe Biden said the US's contribution would not burden taxpayers as it would be repaid through interest earned from immobilized Russian assets.
