In the words of Saturday’s statement, the G7 has made “progress” on a U.S.-led proposal to “front-load” future profits on loaned assets, but countries such as France and Germany have decided that taxpayers will be penalized. I’m worried about being exposed to it. If Kiev is unable to repay the debt even after the war ends, it will be in jeopardy.
“There are serious technical and legal issues,” said Italy’s Finance Minister Giancarlo Giorgetti, who chaired the meeting as part of the G7 Presidency.
Shortly after President Vladimir Putin invaded Ukraine in February 2022, Russian state assets were frozen in Europe. Since then, they have been invested and are earning interest. After months of disagreement, the United States scaled back its original plan to seize the entire asset and instead use the interest as leverage for financing.
The EU is in a better position as it holds most of Russia’s frozen assets, while US banks hold only a small amount of the funds.
German Finance Minister Christian Lindner said: “We need to understand the various options. It is not time to be specific about some of the elements of such a measure, as the economic and legal implications need to be assessed.” It’s too early,” he said.
After months of disagreements, finance ministers gathered in Italy to try to present a united front, but a rift appeared as EU countries showed only lukewarm support for the plan.
