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A promised $50 billion G7 support package for Ukraine is suffering delays and Ukrainian officials fear it may not be ready in time for an upcoming loan review by the International Monetary Fund, Bloomberg reported, citing unnamed government officials.
The $50 billion in funding is meant to come in the form of a loan that would be paid off over time from the proceeds of some $280 billion in Russian assets frozen by Western nations in 2022 after Russia's full-scale invasion of Ukraine.
But the deal has hit a snag over demands made by the United States and fears of Hungary blocking it, the officials said, speaking on condition of anonymity as talks take place behind closed doors.
The arrangement is delayed over US concerns about a requirement that the European Union renew the asset freeze every six months in a package of sanctions targeting Russia, the officials said, speaking on condition of anonymity.
The US has asked for greater assurances that the EU will do so before President Joe Biden’s administration signs off on the loan without approval by Congress.
A senior Biden administration official, also speaking on condition of anonymity, said the US wants the EU's guarantee that the Russian assets will remain frozen until a just peace deal is in place and Russia pays for damage caused in the invasion.
Ukraine is scheduled to receive the funds by the end of the year but the government fears delays could cause problems in the IMF's fifth review, expected in the next couple of months, of its four-year $15.6 billion Extended Fund Facility program for Ukraine.
The $50 billion promised by the G7 is an important part of the funding Ukraine needs to assure the IMF that it has met its budget requirements, one of the anonymous officials told Bloomberg.
