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Joe Biden’s administration has endorsed a bill that would allow it to seize US$300 billion in frozen Russian and fund reconstruction in Ukraine.
“The bill would provide the authority needed for the executive branch to seize Russian sovereign assets for the benefit of Ukraine,” says the National Security Council in a memo, accessed by Bloomberg.
Bloomberg says the White House is trying to handle this issues maneuvering carefully due to concerns that such a move could contradict the US financial system and drive away foreign investments. However, this is a chance to continue aid for Ukraine while Republicans in Congress are blocking more than $60 billion for Ukraine.
The authors note that the president’s administration wants to coordinate its decision with G7 allies, Europe in particular as about US$200 billion of Russian frozen assets are stored there.
According to memos Bloomberg relies on, the White House thinks cooperation with G7 members “would make it more likely that Europe (where the vast majority of assets are located) will be willing to take this step, given their concerns that taking this action in the Russia context could increase the likelihood that we seize assets in other cases where the legal and policy justification is less strong.”
The source, requesting anonymity, told Bloomberg that the topic is expected to be raised at a meeting of G7 leaders on the anniversary of Russia’s invasion of Ukraine next month.
“The United States, the European Union and other countries are close to solving this problem. There are already precedents for legislative changes that provide mechanisms for the transfer of funds. It is now important to bring this into a single, clear system involving the EU and G7 countries,” said Ukrainian Prime Minister Denys Shmyhal on January 3, setting acquiring Russian funds as a key goal for Ukraine in 2024.
The World Bank estimates that Ukraine’s reconstruction may cost about US$411 billion.
Read also: UN mission to allocate $3B to Ukraine in humanitarian aid
