CNN —
The United States and its Western allies are moving forward with a $50 billion loan plan to Ukraine backed by profits from frozen Russian assets, including a $20 billion contribution from the United States, the White House said Wednesday. It was announced on .
President Joe Biden said, “As part of our G7 policy, the United States today announces that we will provide Ukraine with a $20 billion loan that will be repaid with interest earned from immobilized Russian sovereign assets.” said in an official statement. package. “In other words, Ukraine can now receive the support it needs without burdening taxpayers.”
The president said the loan would support “Ukrainians as they defend and rebuild their country.”
Biden added: “Our efforts make clear that tyrants will be held accountable for the harm they cause.”
Biden administration officials see the aid as crucial for Kiev’s war-torn economy heading into the winter season.
“Ukraine can receive the aid it needs now without burdening taxpayers,” said Daleep Singh, White House deputy national security adviser for international economic affairs.
The announcement comes at a time of political turmoil in the United States, with a presidential election that could return Republican candidate Donald Trump, who has expressed public skepticism about U.S. aid to Ukraine, to the White House. There are less than two weeks left.
The United States plans to repay at least half of the $20 billion loan by December this year, Singh said. The regime plans to use half of the loan for economic support and the other half for additional military aid to Kiev. But the White House would need to secure further authority from Congress to provide some of the loans as military aid.
Singh said if the White House cannot reach an agreement with the Legislature that secures the necessary authority, the administration will reverse course and instead provide the full loan amount as economic aid.
“Either way, we’re going to provide $20 billion. But we’re going to work with Congress over the next few months to make sure that we have enough to provide half of the support through military assistance through overseas military loans and loan guarantee authorities.” “We will assess whether we can obtain additional powers,” Singh said.
The remaining $30 billion in aid will come from the European Union and G7 partner countries, including the United Kingdom, Canada and Japan.
“As we promised in June, the G7 will begin distributing support for Ukraine’s interests by the end of this year, sending an unmistakable signal to the United States and its G7, as Ukraine approaches the winter emergency.” “Be able to meet the needs of our partners without getting tired,” Singh said.
The US-led campaign to reach an agreement among the other G7 countries (UK, Canada, France, Germany, Italy and Japan) was announced at the G7 summit in Puglia, Italy, earlier this year.
In the months since, the United States and its allies have worked out the details of the complex loan. The European Parliament on Tuesday approved about $37.7 billion (35 billion euros) in loans to Ukraine backed by frozen Russian assets.
Further details will be announced after the upcoming G7 finance ministers’ meeting, he added.
Western countries have frozen Russian assets in bank accounts in Europe and the United States as part of sweeping sanctions imposed after Russian President Vladimir Putin ordered the invasion of Ukraine in 2022. The amount is approximately $3 billion and is held in U.S. banks.
So while European officials initially expressed concern that Ukraine could be in trouble if it failed to repay the loan, negotiators ultimately agreed that all participating countries would share the risk. The agreement was drawn up.
If a peace deal is reached in the conflict, Russia’s assets will remain frozen and the loans will either accrue interest until repaid, or Russia will have to pay for the damage it has caused.
Late last year, G7 countries for the first time began considering other sources of long-term funding for Ukraine as they questioned their future political and financial commitments to continue spending their tax dollars on the country.
CNN’s Kayla Tausche, Arlette Saenz and Nikki Carvajal contributed to this report.
