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The United States government has proposed the issuance of at least $50 billion in bonds backed by profits generated by frozen Russian assets to help support Ukraine, Bloomberg reported, citing unnamed sources.
The plan, proposed to the US allies in the Group of Seven, envisions the creation of a special purpose vehicle to pool the estimated $280 billion in Russian sovereign assets frozen by Western nations after the country invaded Ukraine more than two years ago, according to the sources.
The so-called "freedom bonds" would then be issued backed by the profits from the frozen Russian assets, which have been estimated at more than $15 billion over the next four years alone.
The proposal to the G7 - Canada, France, Germany, Italy, Japan, the US and the UK - comes as European leaders discuss how to use the frozen assets to support Ukraine. About two third of the assets are held in Europe, mainly at Belgian clearing house Euroclear.
European Union foreign policy chief Josep Borrell earlier this week proposed transferring about €3 billion per year in profits generated by frozen Russian assets to Ukraine, with about 90% earmarked for military spending this year and 10% for the general budget.
Under the proposal, which still needs to be approved by EU member states at a meeting going on Thursday and Friday this week, the first payment to Ukraine could come as early as July.
The proposal would only transfer profits generated using the more than €200 billion in assets that were confiscated from the Russian central bank when Russia carried out its full-scale invasion of Ukraine more than two years ago. It does not deal with the assets themselves.
