The European Union should take 90 percent of the income from Russian assets frozen in Europe and transfer it to the EU fund for financing arms to Ukraine, suggested yesterday the European head of diplomacy, Josep Borrell.
Borel told reporters in Brussels yesterday that he will submit an official proposal to the governments of the 27-member bloc today, ahead of the EU leaders' summit on Thursday and Friday.
Under Borel's plan, income from the property, such as interest, would go into the European Peace Fund, an off-budget fund that provides military aid to countries outside the EU and was mainly used for Ukraine.
"If we do that, the Russians will not be satisfied," Borel said. "Such a sum of money - three billion euros per year - is not too big, but it is not negligible either."
Officials told Reuters that a decision on the proposal will probably not be made at the summit, but that it will be discussed initially.
About 70% of all Russian assets blocked in the West are kept in Belgium's central securities depository Euroclear, which holds various Russian securities and cash worth 190 billion euros, according to the British agency.
Borel said that not all the money from the confiscated property will go to Ukraine, but he expects that most of it will.
He proposed that the remaining 10 percent of seized assets go to the EU's central budget - which cannot be used to buy weapons - in order to strengthen the defense capacity of Ukrainian industry.
Last week, a senior EU official said that frozen Russian assets in the European Union are likely to generate between 15 and 20 billion euros in net profits by 2027, depending on global interest rates.
Borel stressed that his proposal implies the use of profits from assets located in Europe, not the assets themselves.
European officials initially discussed using profits from seized assets to finance the reconstruction of Ukraine.
But in recent weeks, they have increasingly focused on how to help Ukraine militarily, as Ukrainian forces without enough ammunition struggle to resist a Russian invasion while the US Congress stalls a major military aid package.
German Chancellor Olaf Scholz and EC President Ursula von der Leyen are among the leaders who supported the idea of using the revenue for military aid to Ukraine.
Some governments have also expressed concern that Moscow will retaliate by seizing the assets of Western companies in Russia.
However, Borel claims that the time has come for a decision, which in order to be adopted must have unanimous support.
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