According to a report by Germany**, European Commission President Ursula von der Leyen made a very absurd decision, she is eyeing Russia's frozen $300 billion, and wants to embezzle the proceeds of Russia's frozen assets to aid Ukraine, and now has begun to initiate relevant legal procedures.
Von der Leyen's idea was really eye-opening, to want to make such a thankless and costly move? He offered to use the proceeds from Russia's frozen assets to support Ukraine, not the principal. Generally speaking, the rate of return of institutions is not too high, but the base of frozen assets in Russia is huge.
Since the outbreak of the Russia-Ukraine war, European and American countries have imposed severe sanctions on Russia, freezing up to $300 billion in Russian overseas assets, according to the United Kingdom**.
Let's say we deposit $300 billion in a bank, and the one-year interest rate is 145 per cent, 165% with a three-year period of 195%。At a one-year interest rate, $300 billion is about $4.5 billion a year in interest.
According to reports, the first deputy chairman of the Verkhovna Rada Finance Council of Ukraine, Zheleznyak, claimed that Ukraine received a total of $42.5 billion in military and economic aid in 2023. Of these, the European Union provided Ukraine with 199Of the $300 million in aid, the United States provided $10.9 billion and Japan provided $3.7 billion.
If the proceeds from the freezing of Russian assets are used to aid Ukraine, the EU is expected to increase aid to Ukraine by more than 10%. Ukraine's GDP has continued to decline since the Russia-Ukraine conflict, falling to about $100 billion in 2022, far below the pre-war $200 billion. Ukraine estimates that the fiscal deficit will exceed $40 billion in 2024, so any aid is crucial for Ukraine. For Ukraine, the proceeds from Russian assets are a welcome send-off.
However, the EU's position on aid to Ukraine has wavered, and even if it is willing to help, it faces a dilemma of insufficient funding**, and economic difficulties and high energy costs make it more difficult to raise funds.
It seems that Ms. von der Leyen is also forced to take this step. However, while Russia has up to $300 billion in assets abroad, the total assets of EU countries in Russia amount to $500 billion. Putin will not be stupid enough to only allow ** to set fires and not allow the people to light the lamps, and once the EU makes such a decision, Russia will inevitably take countermeasures. The end result will be that Russia will not only be able to compensate for its losses, but may also receive some surpluses.
Every time the EU proposes the idea of freezing Russian assets, Ukraine always rejoices, but in the end the reason why it is not implemented is because of the fear of Russian countermeasures. This $300 billion is a huge amount of foreign exchange for Russia, which, despite being frozen, still belongs to Russian assets. According to international practice, the only way for other countries to use this fund is through judicial or court judgments, and to dispose of it legally and reasonably. Anything else is illegal.
If the West **and** tries to deprive Russia of its assets with executive power, it will undermine the original world order and rules. This will inevitably provoke opposition and countermeasures from Russia. As early as April last year, Putin signed a ** decree stipulating that if Russian assets are seized or restricted abroad, Russia will implement temporary management of assets of unfriendly countries in Russia. In other words, countries that seize Russian assets will face reciprocal countermeasures, Russia will seize their assets, and only ** has the right to lift this measure.
No one is a fool, and when it comes to money, everyone chooses to remain silent, which shows that Russia still has the initiative in the current Russian-Ukrainian war. I hope that the EU will deliver on its commitments this time, and that we will see what happens.
However, I think von der Leyen is easy to say, but very difficult to do. EU countries have their own agendas, and it is difficult to reach a consensus on action. If they had really been able to unite externally, NATO would have taken action against Russia long ago. Everything is a political game, just to appease Ukraine, but in the end it seems pointless. The operation is always in progress.
The EU has been looking for a suitable legal basis to confiscate these assets, and supporting Ukraine is just an excuse for the assets to end up in their own pockets. If this becomes a precedent, other countries may also freeze EU assets in the name of supporting other countries.
It can be said that the essence of Western countries is still bandit logic, and their so-called spirit of contract is meaningless in the face of interests. Once the contract of national credit as an endorsement is broken, it also represents the bankruptcy of national credit! Just like the sell-off of the dollar around the world, this trend is irreversible.