WASHINGTON - The Biden administration is trying to provide Ukraine with US$10 billion in military aid as part of its US$20 billion (S$26 billion) commitment to the country under a US$50 billion loan coordinated with the G-7 and European Union, the White House National Security Council said on Oct 23.
Group of Seven countries immobilised Russia's sovereign assets in their jurisdictions after Russia invaded Ukraine in February 2022.
As part of the G-7 package, President Joe Biden said: "We will provide US$20 billion in loans to Ukraine that will be paid back by the interest earned from immobilised Russian sovereign assets. In other words, Ukraine can receive the assistance it needs now, without burdening taxpayers."
The United States plans to disperse US$10 billion by December as economic aid, but needs US lawmakers' approval for an additional US$10 billion in the form of military assistance, the White House National Security Council said on Oct 23.
"Our ability to do that relies on Congress taking action before mid December," the NSC said.
"Either way, the US will provide US$20 billion in support to Ukraine through this effort, whether it's split between economic and military support or provided entirely via economic assistance," officials added.
On Oct 22, US Treasury Secretary Janet Yellen said that G-7 and European Union allies were "very close" to finalising their overall Ukraine loans, which would be backed by the frozen Russian assets.
The income used to repay these loans will be generated from interest earned on the roughly US$300 billion in frozen Russian assets held mostly in the European Union.
Speaking at the start of International Monetary Fund and World Bank annual meetings, Dr Yellen said she was confident the Russian sovereign assets will remain immobilised despite the need for EU renewal of the freeze every six months.
Because the EU also committed to lending Ukraine at least US$20 billion, the Europeans have "incentives to keep the assets immobilised until we get fully repaid," the NSC said on Oct 23.
EU lawmakers on Oct 22 approved the bloc's plan to use the frozen Russian assets for the loan.
The NSC said it was possible that the US could end up transferring the entire US$20 billion US share of the loan this December to the World Bank Trust Fund, which will manage the funds, adding that the White House will keep talking to Congress in coming weeks.
In the meantime, the US will sign the loan agreements with Ukraine to disperse funds before the year's end, the NSC said, adding that more details are expected in coming days after the G-7 finance ministers' meeting concludes. REUTERS