Germany wants to arm Ukraine with Russian funds — RT World News

German Chancellor Olaf Scholz said on Monday that the interest earned on Russian assets frozen by the European Union should be spent on purchasing weapons for Ukraine.

The United States and its allies confiscated about $300 billion in assets owned by the Russian Central Bank in February 2022, when the conflict escalated in Ukraine. The European Union stopped short of completely confiscating the funds, instead proposing to direct the interest to Kiev.

He added: “It is important that we also agree that this money can be used to purchase weapons not only in the European Union, but also around the world.” Schulz told reporters in Riga after a meeting with the governments of Lithuania, Latvia and Estonia.

He supported EU Foreign Policy Commissioner Josep Borrell's proposal on how to allocate the funds. According to Borrell, about 90% of the interest should be spent on arms purchases for Ukraine through… “European Peace Facility” While the rest will be allocated to European Union budgets to support Kiev's military industry.

Schulz added that Germany and the three Baltic states would like to see an increase in arms production in the European Union. Both the European Union and the United States are struggling to meet Ukraine's demands for weapons and ammunition.

The United States and its allies have pledged more than $200 billion in military and financial aid to Kiev over the past two years, insisting that the conflict must be a solution. 'strategic defeat' To Moscow even though they denied their direct involvement in the hostilities.

Kiev called on the West to confiscate all frozen Russian assets in order to help finance the conflict. The United States and Canada were supportive, but the European Union remained skeptical.

Euroclear, the European Union's central securities depository based in Belgium, holds about 70% of the total frozen Russian funds. The frozen assets generated an estimated €4.4 billion ($4.7 billion) in interest income in 2023 alone. After-tax revenues from assets could reach 20 billion euros ($21 billion) by 2027, according to some European Union estimates.

Moscow denounced the asset freeze “theft” It threatened retaliation against the assets of individuals and companies residing in the European Union subject to its jurisdiction. Critics of the EU expropriation plan have also pointed out that it could damage Euroclear's reputation, harm the rule of law and property rights, and possibly even lead to a collapse in the value of the euro.