US and Europe near deal on novel funding plan for Ukraine
STRESA, Italy—The U.S. and its allies are moving toward an agreement on a novel financing plan that would provide Ukraine with up to $50 billion, though Western officials are still working through important details on the use and structure of the funds. The idea relies on the investment returns—mainly interest payments—generated by the roughly $300 billion in Russian sovereign assets that the U.S.
and Europe froze in their jurisdictions after the invasion of Ukraine. Biden administration officials have proposed creating a new financial instrument that would deliver many years worth of expected profits on the Russian assets to Kyiv in the short term while leaving the underlying Russian assets untouched. The funding could provide another stream of aid for Ukraine as support for the war-torn nation has become mired in political divisions in the U.S.
Presumptive Republican nominee Donald Trump has opposed money for Kyiv and officials involved in the talks see a narrow window to strike a deal before elections in Europe and the U.S. this year. Finance ministers from the Group of Seven advanced democracies are discussing the funding questions in meetings this week in Stresa, a resort town along the mountainous coast of Lake Maggiore in northern Italy.
The U.S. goal is to refine the idea enough that the heads of governments that lead the G-7 could endorse it at their own gathering in the coming weeks, even if some technical work is left for the summer. “The details of the proposal have not been decided," Treasury Secretary Janet Yellen said during a press conference Thursday.
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