July 18, 2024

G7 signs $50bn loan for war-ravaged Ukraine

The Group of Seven major democracies agreed on Thursday to provide a $50 billion loan to Ukraine.

The G7 is sourcing the money from the interests accruing to Russian assets frozen after Russia launched its war against Ukraine in 2022.

The Group of Seven consists of France, Germany, Italy, Japan, the United States, the United Kingdom, and Canada.

The world’s largest developed economies agreed to the loan to Ukraine during the opening day of the annual summit of the G7 leaders taking place in Italy.

“There is a lot of work to be done, but I am sure that in these two days (of the G7 meeting), we will be able to have discussions that will lead to concrete and measurable results,” Italian Prime Minister Giorgia Meloni told her G7 guests.

The G7 plan revolves around a multi-year loan using profits from some $300 billion of impounded Russian funds.

Fear is already being expressed, however, that the idea of the loan might draw unsavoury repercussions, as Russia is already quoted as saying that attempting to use income from its assets is criminal and that it will respond in a way that the European Union will find painful.

Western nations had frozen Russia’s assets in bank accounts located within Europe and the US as part of sanctions after Russia’s Vladimir Putin ordered the invasion of Ukraine about two years ago.

The Russia-Ukraine war has continued in the meantime.

On Wednesday, June 12, nine people were reported killed in Russian aerial attacks on Ukraine.

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