Page 50 - RusRPTApr24

The EU's new defense industry strategy envisages using Russian assets to finance Ukraine's defense industry. The EC has presented a legislative proposal regarding the European Defense Industry Program (EDIP), which would allow for future financing of support for Ukraine's defense-industrial complex at the expense of profits from the frozen assets of the Russian Federation. EDIP will ensure the transition from short-term emergency measures adopted in 2023, ending in 2025, to a more structured and long-term approach and the achievement of military-industrial readiness. EDIP will mobilize €1.5B from the EU budget during fiscal years 2025-2027 to further increase the competitiveness of the European defensive technological and industrial base. It is assumed that the EDIP budget will also strengthen the EU's military-industrial cooperation with Ukraine and support the development of its military-industrial and technological base. For this purpose, EDIP can receive additional financing from the profits of immobilized Russian assets (subject to the adoption of a decision by the Council of the EU). Russian assets on Euroclear’s balance sheet brought €3.25B in profit in 2023; this year, the profit will reach a similar level.
Swiss parliament backs measures to confiscate frozen Russian assets for Ukraine reconstruction. The Swiss government estimated in December 2023 that it had frozen $8.8 billion in Russian state assets as part of its sanctions against Russia.
Borrell wants to use 90% of Russian assets profits to buy arms for Ukraine. The remaining 10% would be allocated to the EU's budget to boost Ukraine's defense industry, Josep Borrell told reporters in Brussels. The official said he would submit the proposal to member states on March 20.
Markets to sour if seizing income on Russian assets not 'legally bulletproof' — Belgian PM Alexander De Croo said that the EU will not be able to use confiscated income from Russian assets to rebuild Ukraine if Kyiv loses, so the money is needed for weapons
● Sanctions
The introduction on high tariffs on the import of Russian grain to the EU will have virtually no impact as the volume of Russian grain arriving in the EU is so small and is not worth a lot of money. The European Commission (EC) has proposed imposing a tariff of €95 per tonne on Russian and Belarusian imported grain, a plan being debated at the EU summit in Brussels on March 22. Nominally the measure seeks to avert potential market destabilization by preventing the arrival of large amounts of grain from Russia which has been enjoying several years of record large harvests. However, the increase in tariffs with have almost no impact on Russia, as a high-ranking EU official noted that Russia's nearly 5mn tonnes of annual grain exports to the EU constitute merely 1% of the EU's total grain market and was only worth €1.3bn in 2023, less than 1% of what Russia earns from oil exports. Russia has long since diversified its grain exports to the so-called friendly counties in the global south. Russian grain exports may total up to 65mn metric tonnes in the agricultural year of 2023-2024, President Vladimir Putin said at a meeting with agricultural sector workers earlier this year.
50 RUSSIA Country Report April 2024 www.intellinews.com