The G7 is thinking of only accepting the interest and value increase that has occurred since the assets were frozen in 2020.
However, the president of Ukraine told the BBC that all of the funds ought to be spent. “If the world has $300bn – why not use it?” , he responded.
The BBC is aware of the concerns European central bankers have about jeopardizing the safe haven status of banks.
The governments of the US and the UK have expressed some enthusiasm, but the central bankers of Europe are far less enthusiastic about creating a challenging legal precedent that might jeopardize the stability of the global financial system. It might make other nations reconsider allocating their safe haven resources to the West.
UK considers funding Ukraine’s defense with assets that Russia has frozen.
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Because of its involvement in the clearing system for European reserves, Belgium in particular is home to a sizable portion of the frozen assets. It has already imposed a fee on certain funds that have raised €2 billion for Ukraine. Given that there are currently high interest rates and about $360 billion in frozen assets, proponents of the larger plan believe tens of billions of dollars could be raised.
On the fringes of the World Economic Forum in Davos, Switzerland, President Zelensky told the BBC that Western taxpayers shouldn’t be paying for the war in Ukraine.
“We have $300 billion in frozen Russian assets,” he declared. They demolished the Ukrainian Republic.If we possess $300 billion in Russian assets, we must employ them immediately to reconstruct the areas that Russian missiles have destroyed. Why does your community need to consider ways to assist? Why not make use of the $300 billion the world has?
At Davos, President Zelensky met with Wall Street financiers Steven Schwarzman of Blackstone and Jamie Dimon of JP Morgan.
Due to concerns about “weaponizing” central banks and currencies, Bill Winters, the head of the British bank Standard Chartered, stated that there would be “mixed” reactions from the international financial community to the seizure of the profits from Russian frozen assets.
“We might argue that doing the right thing is worthwhile, and most of us would agree that it is the right thing on a human level. However, I believe central bankers have good reason to be worried,” he remarked.
“Over time, the US dollar will become so important that we will need to exercise caution in how we use it as a weapon. The imposition of sanctions has already made it fairly weaponized. Winters told the BBC that this would be an even bigger extension of that.
The president of Ukraine told the World Economic Forum that his nation was defending Europe and that some people in the West were unaware that Putin was only interested in their territory. He also said that Ukraine needed more assistance.