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likely to be regularly transferred to Kyiv. However, a portion of these funds may need to be reserved in Europe in anticipation of mass claims against Euroclear. Euroclear could lose €33bn located in Russia. Additionally, the Bank of Russia has the right to sue to seize Euroclear's funds in Hong Kong and Dubai. Lawsuits are also expected against Western banks that lose money in Russia due to its retaliatory measures. In the worst-case scenario, the European depository could be "completely depleted." If it runs out of capital, its license may be revoked, potentially leading to a global financial crisis given that Euroclear's total assets amount to €37 trillion. Hence, discussions in the EU are ongoing about how much profit can be sent to Kyiv and how much should be kept in Europe. There's also a need for an emergency aid mechanism for the depository if it faces financial difficulties.
Borrell supports issuing bonds for the defense of the EU and using Russian asset revenues for Ukraine. The EU can issue bonds to finance defense needs, as Russia threatens the bloc's security, said the head of EU diplomacy, Josep Borrell. Debates have recently begun on the prospect of the EU assuming debt to cope with the significant effort needed to invest in its defensive capabilities. According to him, the war against Ukraine increased the urgency of expanding the European military industry’s production capacity. Borrell believes that the EU needs to move from a state of emergency to a long-term vision to restock and develop the defense capabilities required for a future that includes a more contested geopolitical environment while still providing adequate military support to Ukraine. He added: "If the member states agree, we could use the profits from the frozen assets of the Russian Federation to purchase weapons for Ukraine or strengthen its defense industry." According to him, using these resources to support the Ukrainian military through the European Peace Fund would be possible.
London ready to loan Ukraine all frozen Russian assets in UK. The assets will be used as a surety for the payment of the reparations, U.K. Foreign Secretary David Cameron said.
Current Russian assets in the UK ($23bn), Luxembourg ($6.8bn) and Switzerland ($8.7bn) would be enough to meet Ukraine’s needs for rebuilding its transport infrastructure. This includes 16 damaged or destroyed civilian airports, at least 344 bridges and over 25,000 kilometers of highway.
Meanwhile, frozen assets in Germany ($6.5bn), Austria ($1.8bn), Ireland ($2bn) and Poland ($1.13bn) would be sufficient to help restore over 3,500 damaged or destroyed educational facilities — including 1,700 schools, more than 1,000 kindergartens and 586 universities.
And that’s not all. Russian assets in France ($1.48bn) would be enough to build a new hydroelectric power plant to replace Ukraine’s Kakhovka plant, which Russia destroyed last summer. And the profits from Russian assets held in Belgium’s Euroclear depository for 2022 and the first half of 2023 alone total $2.56bn. That money could rebuild 1,223 health care facilities, including 384 hospitals and 352 outpatient centers damaged or destroyed by Russia.
All of this can happen as soon as the political will is there — and the time for that it is now. It will be worth it.
49 RUSSIA Country Report April 2024 www.intellinews.com