US Proposes Using Frozen Russian Assets to Provide 68 Trillion Won Support for Ukraine

Outlook for Discussion at Next Month's G7 Summit
EU Expected to Face Pressure Amid Fears of Russian Retaliation

The United States is considering a plan to support Ukraine with approximately 68 trillion won by utilizing 'windfall profits' obtained from frozen Russian assets.

On the 3rd (local time), Bloomberg reported that the U.S. is discussing this plan with the Group of Seven (G7). According to sources cited by Bloomberg, the U.S. is negotiating with member countries to agree on a plan to provide up to $50 billion (about 68 trillion won) in support at the G7 summit to be held in Italy next month.

Janet Yellen, U.S. Treasury Secretary, also confirmed this in an interview with Bloomberg. "Ideally, we hope that the entire G7 participates, not just the U.S. alone," she said.

This comes after the U.S. Congress recently passed a $61 billion aid package for Ukraine, marking another round of support for Ukraine.

Bloomberg also predicted that the U.S. will apply new pressure to the European Union (EU), which has opposed the use of frozen Russian assets, to reverse its stance.

Earlier, after Russia invaded Ukraine in February 2022, Western countries froze about 260 billion euros (approximately 381 trillion won) of Russian assets. The U.S. has advocated confiscating these assets to support Ukraine, while EU countries have expressed skepticism due to legal uncertainties, concerns that the euro's status could be destabilized in the long term, and fears that Russia might retaliate if the asset freezes are lifted.

Russia's frozen assets are in the form of securities and cash. Most are held at Euroclear, an international central securities depository based in Belgium. According to Euroclear, these assets have generated about 2.9 billion euros (approximately 5.7 trillion won) in net profits since last year. If liquidated, they could increase to as much as 190 billion euros by 2028.

The EU is discussing managing these 'windfall profits' in a separate account and using 2.5 to 3 billion euros annually to support weapons aid for Ukraine. This plan, pursued solely by the EU, is expected to be agreed upon as early as the beginning of next month.

The U.S. position is to advance the use of these windfall profits, which amount to about 5 billion euros annually, as aid for Ukraine. The goal is to provide the maximum support as quickly as possible.

Bloomberg cited sources who forecast that it may take several months for these discussions to reach an agreement.