By Angelo Amante and David Lawder
ROME/WASHINGTON (Reuters) – Leaders of the Group of Seven Rich Democracies agreed on Friday to lend nearly $50 billion to Ukraine, backed by gains from Russian state assets frozen from December.

“These loans will be repaid and repaid by future extraordinary revenue streams resulting from the immobilization of Russian State Assets,” the G7 statement said.

In an additional statement made by G7 finance ministers, it was stated that the loans will be distributed through a series of bilateral loans “in installments to reflect Ukraine’s urgent financing needs” starting on December 1 and until the end of 2027.

Each bilateral loan will come into force no later than June 30, 2025, providing some timing flexibility for G7 members to adjust the details.

In the statement where the principles and some technical details were explained, it was stated that while specific amounts for bilateral loans were not specified, additional details would be published in a term sheet to be distributed in the coming days.

ELECTION TIME

The United States announced Wednesday it would provide Ukraine with a $20 billion loan through December; The timing was meant to protect against potential repossession of loan funds if Republican presidential candidate Donald Trump wins the US election in November.

Trump has vowed to “withdraw” from Ukraine’s war with Russia. The next US president won’t take office until January.

Another $20 billion loan is expected to come from the EU, which includes G7 members Germany, France and Italy, while the remaining $10 billion is expected to be shared between Canada, the United Kingdom and Japan.

In the statement of the finance ministers, it was said: “We will stand by Ukraine no matter how long it takes.”

The statement stated that the loans will be distributed through many channels, including the Macro-Financial Assistance Loan from the EU, the IMF’s Multi-Donor Managed Account for Ukraine and the newly created Financial Intermediation Fund for Ukraine at the World Bank.

G7 Commitment

Friday’s announcement of “extraordinary revenue acceleration loans” fulfills an easement reached in June by G7 leaders during their annual summit in southern Italy to use proceeds from frozen Russian assets to help Ukraine; This agreement requires many technical details to be resolved. .

Approximately 260 billion euros ($280.62 billion) of Russia’s assets, such as central bank reserves, were frozen as part of the sanctions imposed after Moscow invaded Ukraine in February 2022.

The vast majority of these assets are held at Euroclear, a central securities depository based in Belgium, making the European Union a key player in any plan to exploit the assets.

“The G7 remains steadfast in its solidarity to support Ukraine’s struggle for freedom, recovery and reconstruction,” the G7 leaders’ statement said, adding that “time is not on (Russia’s) President Putin’s side.”

($1 = 0.9265 euro)

(Reporting by Angelo Amante; Writing by Sara Rossi and David Lawder; Editing by Paul Simao and Andrea Ricci)

Disclaimer: This report is auto-generated from the Reuters news service. ThePrint bears no responsibility for its content.