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Zelensky Pins Hopes on Important Decisions at G7 Summit for Ukraine's Defense and Economic Resilience

Thursday 13 June 2024 - 13:40
Zelensky Pins Hopes on Important Decisions at G7 Summit for Ukraine's Defense and Economic Resilience

As the G7 summit of leaders from the world's most influential economies convenes in Italy, Ukrainian President Volodymyr Zelensky has expressed his anticipation for "important decisions" to be made, with a significant portion of the agenda dedicated to bolstering Ukraine's defense capabilities and economic resilience. In a post on Telegram, Zelensky stated, "A large part will be devoted to Ukraine, our defense and economic resilience."

The White House has revealed that the G7 has made significant progress on a U.S. plan to utilize frozen Russian assets to raise an annual sum of $50 billion (£39 billion) for Ukraine's benefit. This innovative strategy aims to leverage the interest generated by the $325 billion in Russian assets frozen by the G7 nations and the European Union following Moscow's invasion of Ukraine in 2022.

Under international law, countries cannot directly confiscate these assets from Russia and transfer them to Ukraine. However, the substantial interest accrued, estimated at around $3 billion annually, presents an opportunity for creative financial maneuvering. The plan involves taking out a loan on the international markets, providing approximately $50 billion to Ukraine each year, and utilizing the $3 billion in interest to pay off the loan's interest charges annually.

While the concept appears straightforward, its implementation is fraught with complexities and technicalities that must be navigated. Nonetheless, President Biden's security adviser, Jake Sullivan, has expressed optimism, stating that the "major tentpoles" of the plan have been decided, and a favorable outcome is likely.

Russian officials have denounced the proposed utilization of the interest from seized assets as "theft," highlighting the contentious nature of the endeavor.

With President Biden facing a close election contest and several other Western leaders trailing in polls, there is a sense of urgency to deliver tangible support to Ukraine while their political clout remains intact. The UK's Prime Minister Rishi Sunak, grappling with an uphill battle ahead of next month's general elections, is poised to announce up to $309 million in support for Ukraine's energy and humanitarian needs.

Similarly, French President Emmanuel Macron's party faces a snap parliamentary election after a resounding loss to the far-right National Rally in last weekend's elections to the European Parliament. Italy's Giorgia Meloni, buoyed by her party's strong performance in the European elections, has boasted that her country is entering the summit with "the strongest government of all."

Amidst the shaky political landscape in many G7 countries, some observers harbor low expectations for the summit's achievements. Natalie Tocci, the director of the Italian Institute for International Affairs, cautioned that "if anything will come out of this summit, it's the fear of a catastrophe playing out before our eyes," alluding to the potential for new governments led by Donald Trump in the U.S. and the far-right in France.

In addition to Ukraine's defense and economic resilience, the summit's agenda encompasses a range of pressing global issues, including the war in Gaza, migration, economic security, and the safety of artificial intelligence (AI). Pope Francis, in an unprecedented move for a pontiff, will address the subject of AI at the conference, having previously called for global regulation to safeguard ethics and human rights in the face of this emerging technology.

As the G7 leaders convene, the world's attention is fixed on the pivotal decisions that could shape the course of Ukraine's defense against Russian aggression and its economic recovery, as well as the collective response to other pressing challenges confronting the international community.

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