Leaders of the G7 countries had to be inventive in finding new ways to finance the war in Ukraine and one avenue that was explored was using Russian assets that were frozen as a result of sanctions imposed on Russia .
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However, directly dipping into Russian assets to finance the war in Ukraine could have “set a precedent” that would have undermined the subsistence of the “rule of law”, a notion to which Western countries strongly adhere, says the member associated with the Raoul-Dandurand Chair, Guillaume Lavoie.
“We cannot seize the property of others without compensation,” he says. There’s a technical word for it and it’s theft.”
To achieve their goal, the members of the G7 and the European Union decided to invest the frozen 300 billion Russian euros to finance Ukraine with interest.
“It will back our loan to Ukraine and that is how we will repay ourselves,” he explains. That’s almost $3 billion in interest per year.”
“Somewhere, it is Russian money which creates interest, which we will use to help Ukraine which really needs it,” maintains the analyst. There’s some Joe Biden genius in that.”
Is that enough?
On the other hand, these approximately three billion dollars per year will not be enough to finance the entire Ukrainian war effort, specifies Mr. Lavoie.
This is why the G7 countries took the initiative of lending 50 billion to Ukraine and repaying themselves with the interest on these investments.
But again, nothing indicates that this will be enough to run out of steam for Vladimir Putin’s regime.
“In this conflict, we never say it enough, it is the more determined of the two who wins,” admits the specialist in geopolitical issues. “The resolution of the Ukrainians’ decision is clear, but so is that of Vladimir Putin and if it still lasts and Putin makes gains, it is because for more than a year, we looked at each other to know: ” are we going to help Ukraine?” Any delay benefits Vladimir Putin.”
Joe Biden’s commitment
Associate member of the Raoul-Dandurand Chair recalls that the American president attaches great importance to the issue in Ukraine, even before the invasion of the country by Russia in February 2022.
He explains that Joe Biden spent 30 years in the US Senate assigned to the Foreign Affairs Committee as well as the Eastern Europe subcommittee, “including Ukraine”.
“This has been the issue close to his heart for a very long time,” he says. “He was one of those in the Obama administration who said more needed to be done, but Obama didn’t seem convinced.”
According to him, it was “probably” Barack Obama’s hesitation to get involved in Ukraine following the first insurrections in 2014 “that ended up convincing Putin to move forward.”
“The issue of Ukraine is inseparable from Joe Biden’s commitment on a personal level and if there was a rapid organization against Vladimir Putin, it is really [en raison] of the personal commitment of the American president,” he assures.
Watch the full interview with Guillaume Lavoie in the video above.
