US Treasury Secretary Urges G7’s More Ambitious Plans for Russian Assets

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US Treasury Secretary Janet Yellen on Thursday urged G7 ministers meeting in Italy to discuss “more ambitious options” for using frozen Russian assets to help Ukraine.

Ministers and central bankers from the Group of Seven met in Stresa, on the shores of Lake Maggiore, northern Italy, to prepare for next month’s summit of G7 heads of state in Puglia.

Separately, he said they would also discuss what he considered “excess capacity” of green technologies such as electric vehicles, batteries and solar panels.

Top of the KKT’s agenda is a plan to finance vital aid to Ukraine using interest generated on 300 billion euros ($325 billion) of Russian central bank assets frozen by the G7 and Europe.

The European Union earlier this month approved using interest from frozen assets to arm Ukraine, hoping to raise up to three billion euros ($3.3 billion) a year.

In a press conference ahead of the meeting in Stresa, Yellen welcomed the plan but added that “we must also continue our collective work on more ambitious options, considering all relevant risks and acting together.

He said he wanted “concrete options” to be presented at the G7 leaders’ meeting on June 13-15. “Failure to take additional action is not an option – not for Ukraine’s future and not for the stability of our own economy and the security of our people,” he said.

The United States has proposed lending Ukraine – which has been battling a Russian invasion for more than two years – up to $50 billion secured by interest on those assets.

However, the details are not yet final, including whether the debt will be issued by the US alone or the G7 countries as a whole.

“We are seeking general agreement on the concept” in Stresa, with details to be finalized in the coming weeks, Yellen said.

He confirmed that “50 billion is a figure that has been mentioned as a figure that could possibly be achieved in this way. However, there has been no decision on the amount”.

In addition to the United States and Italy, the G7 includes the United Kingdom, Canada, France, Germany and Japan.

Law problem

Yellen initially advocated a more radical solution, confiscating Russia’s own assets. But European countries are concerned about creating a precedent in international law and the risk of serious legal disputes with Moscow.

A Treasury source in Italy, which holds the G7 presidency this year and is hosting the Stresa talks, said the US proposal was “an interesting way forward” but “any decision must have a solid legal basis”.

Italian Economy Minister Giancarlo Giorgetti said Rome would be an “honest mediator” in discussions but said the task was “very complicated”.

Experts warn that further G7 action against Russia could result in similar retaliation against European companies still operating in the country.

In April, Moscow sent a veiled warning to Italy in its capacity as G7 chairman, taking “temporary” control over a Russian subsidiary of Italian heating equipment group Ariston in retaliation for what it called “hostile actions” by Washington and its allies. .

John Kirton, director of the G7 Research Group at the University of Toronto, said that simply capitalizing on the interest on Russian assets “would greatly reduce the legal issues.” “Legally, they did not confiscate the ‘assets’,” he told the AFP news agency.

France on Wednesday welcomed the US plan, saying it hoped G7 finance ministers would reach an agreement this week.

“America has put forward a proposal that is in line with the international legal framework, and we will discuss it openly and constructively,” said Economy Minister Bruno Le Maire.