Will frozen Russian assets go to Ukraine? Biden is considering a takeover
Reports indicate that President Joe Biden is considering seizing frozen Russian assets. Frozen reserves of Russian banks will be used to finance Ukraine’s war efforts. However, the plan has its pitfalls, and critics say it could destabilize the financial system.
Reports indicate that the Biden administration is preparing plans to seize $300 billion from the frozen assets of the Russian Central Bank to finance Ukraine’s fight against the Russian invasion.
Russian money for Ukraine
Administration officials told The New York Times that talks have been ongoing in recent weeks between the U.S. government, diplomats and finance ministers about the use of assets that were frozen in 2022 as part of sanctions imposed on Russia over the unprovoked invasion.
The move comes amid signs that support for Ukraine may be waning in some Western countries, and that multibillion-dollar U.S. aid to Ukraine has been blocked by Republicans in the House of Representatives.
A risky move
But critics say the plan has its pitfalls and there are concerns the move could weaken the global financial system. They argue that countries could be hesitant to keep dollar funds if they thought they could be seized, accelerating some countries’ plans to abandon the currency.
Agathe Demarais, a geoeconomics specialist at the European Council on Foreign Relations, wrote in Foreign Policy in November that the move could have unforeseen consequences.
“If Western democracies have already set a precedent by seizing Russian assets, how can these countries convince anyone that China or India have no right to confiscate Western holdings if they so wish?” – she wrote.
