The UK government has announced a proposal to provide Ukraine with GBP 2.26bn (USD 3bn) to be repaid from future profits generated by frozen russian sovereign assets.

The funds will be used to cover defence and security sector expenditures, including strengthening air defence, procurement of necessary military equipment, etc.

The UK’s proposal is part of the G7 agreement to launch a USD 50 billion Extraordinary Revenue Acceleration Loans for Ukraine.

“This is an extremely timely and necessary decision by the UK and a significant contribution to the financing of budgetary needs. The announced proposal provides for an unconditional and non-repayable form of financing within which Ukraine will be able to ensure priority military expenditures. I am grateful to the UK Government for its efforts in supporting Ukraine’s fight against russian aggression,” said Sergii Marchenko.

Background

On 14 June 2024, at the G7 Summit in Italy, the G7 leaders agreed to provide Ukraine with about USD 50 billion. The funds will be serviced and repaid from future profits earned from frozen russian sovereign assets located in the European Union and other jurisdictions.

At the same time, on 20 September, European Commission President Ursula von der Leyen announced the European Commission’s proposal to provide Ukraine with Macro-Financial Assistance (MFA) in the amount of up to EUR 35 billion for 2024-2025.