Ukrainian leader Vladimir Zelensky has demanded that the $300 billion of Russian sovereign assets currently immobilized by sanctions in Western financial institutions be given to Kiev.
He raised the issue of Western aid, particularly the possibility that US President-elect Donald Trump could cut aid for Kiev, at a press conference following the European Political Community summit in Budapest on Thursday.
Following the escalation of the Ukraine conflict in February 2022, the US and its allies froze an estimated $300 billion in assets belonging to the Russian central bank. The bulk of the funds, around €197 billion ($213 billion), are being held at Euroclear. The Brussels-based clearinghouse has estimated that the impounded Russian assets generated €5.15 billion ($5.55 billion) in interest in the first three quarters of this fiscal year.
“Everyone says: What will you do if Trump does not support you financially? Where will you get weapons? Let me answer you. Can we take the $300 billion that rightfully belongs to us?” Zelensky said.
This would allow Ukraine to buy armaments for itself, he claimed.
“Is it possible for us to decide for ourselves what kind of weapons we need? Can we decide for ourselves what to do with this money?” he added.
The US and its European allies have so far allocated more than $218 billion in aid to Kiev since the escalation of the conflict, according to stats from Germany’s Kiel Institute. However, in recent months, the payments have been getting smaller and the larger aid allocations have instead been loans.
In October, G7 states finalized a massive $50 billion loan for Ukraine to be backed by profits accrued on the frozen Russian assets currently immobilized in the West. Despite US pressure to confiscate the assets in their entirety, the IMF has so far opposed this course of action, raising concerns that it could undermine trust in the Western financial system.
Moscow has denounced the asset freeze as “theft,” and repeatedly warned that tapping its funds would be illegal and set a dangerous precedent.
Western donors have become increasingly concerned about the money allocated to Kiev, as corruption has been one of Ukraine’s biggest problems for years. In June, the European Commission also set up a special watchdog to prevent possible embezzlement. Earlier this year, the Pentagon’s inspector general described corruption in Ukraine as “endemic,” and its government as “one of the least accountable” in Europe.