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G7 discuss legality of seizing £204bn in frozen Russian reserves and handing it to Ukraine

THE United States sought to build support for squeezing more money for Ukraine out of frozen Russian assets today as finance ministers from the Group of Seven rich countries opened a two-day meeting in Italy.

US Treasury Secretary Janet Yellen pushed for “more ambitious options” to unlock money from some $260 billion (£204bn) of Russian central bank reserves frozen in Europe and the US in the wake of the February 24 2022 invasion.

Aid for Ukraine has become more urgent as Kiev’s financial position weakens with the prospect that the conflict will last through next year and beyond and as Russia steps up its destruction of civilian infrastructure such as power stations.

Citing legal concerns, European officials have balked at confiscating the money and handing it to Ukraine. Instead they plan to use the interest accumulating on the assets, but that’s only around £2bn a year — about one month’s financing needs for the Ukrainian government.

Proposals include borrowing against the future interest income from the frozen assets, so that Ukraine could be given as much as £39bn immediately.

Host Finance Minister Giancarlo Giorgetti said that extracting more for Ukraine “legally is a very complicated discussion but also politically sensitive.”

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