USA convinces EU to seize about $300 bln in frozen Russian assets and return them only after peace agreement with Ukraine
The Biden administration is making a final effort to seize $300 billion in Russian assets and convince European partners to support the transfer of money from the Russian Central Bank to a new escrow account that will be opened only as part of a peace agreement, CNN said on Tuesday, citing two senior officials in the U.S. presidential administration.
It is noted that, despite the fact that the Russian Central Bank funds were frozen about three years ago, most of this money is still stored in European banks, although some remains in the U.S. banks.
The seizure of assets should have been a simple message to Moscow, one senior administration official told CNN: "If you want your money back, you’re going to have to come talk." Biden's top officials have consulted closely on the idea with President-elect Donald Trump's national security team, including Sen. Marco Rubio, his secretary of state designee, and Representative Mike Waltz, who is expected to be named national security adviser.
The Trump camp is generally supportive of the strategy, according to people familiar with the matter, believing the seized money could give Russia a new incentive to come to the negotiating table, and Trump wants to see a swift end to a war he believes has already gone on too long.
The Europeans, however, are less keen, raising concerns that it would violate international law if banks confiscated the Russian money entirely. Last year, the G7 agreed to use the interest accrued on the frozen investments, which generate about $5 billion in annual revenue, as a loan to Ukraine.
The $50 billion loan would be repaid from the investment profits over ten years. The Europeans remain skeptical about seizing frozen Russian money, the sources said, making any deal unlikely before Trump takes office.
The White House has long supported the idea of using $300 billion in frozen Russian money to finance Ukraine’s reconstruction and strengthen its influence. Biden has personally discussed the issue with G7 leaders in recent meetings, a White House official said.
Secretary of State Antony Blinken, speaking at a news conference in Paris last week, said the outgoing administration wants to make sure that if the Trump administration decides to negotiate, it does so from a position of strength and that President Trump can get the strongest deal possible.