Treasury Secretary Janet Yellen on Sunday reaffirmed the legality of the Group of Seven (G7) $50 billion loan to Ukraine and touted the strong alliance between the Western countries.
“There is no sense at all in which it’s theft,” Yellen told ABC News’s Jonathan Karl when asked on “This Week” whether she has concerns about Russian President Vladimir Putin calling the loan “theft” and saying it “will not go unpunished.”
Members states of G7 announced Thursday an agreement to move forward with a $50 billion loan to Ukraine, financed by the interest generated on frozen Russian assets in Europe and the U.S. The proposal was led by the U.S.
The G7 members froze about $280 billion in Russian assets after the invasion began in February 2022, and the proposal would use the interest generated on the frozen assets, which is about $2.6 billion to $3.6 billion a year, to pay back a $50 billion loan to provide to Ukraine immediately.
The agreement marks a significant achievement for President Biden, with the U.S. spearheading the effort to get Ukraine’s supporters to agree on seizing Russian assets to support Kyiv and counter Putin.
“Russia’s funds are sitting in cash, but they’re generating income for the institution, which Russia has no claim on,” Yellen said, “so there’s no legal issue here.”
“And our allies, our partners, the G7 will provide Ukraine a $50 billion loan, which will be repaid over time from these proceeds,” she added. “I’d say the G7 leaders had already made it clear that they will not unfreeze these assets until Russia pays for the damage that it’s caused to Ukraine.
The commitment from G7 countries comes as Russia’s more than two-year illegal war against Ukraine is straining unity among Kyiv’s military and financial backers.
That has translated into battlefield losses for Ukraine without adequate military supplies, though Ukraine was able to largely push back Russia’s latest offensive around the city of Kharkiv.
Yellen described the dynamic as a “battle of wills” and said she thinks Putin is waiting on Ukraine’s supporters to give up on the war-torn democracy.
“We’re really in a battle of wills with Putin,” she said. “Putin, I think, believes that our coalition will crumble, in the sense we won’t go on providing Ukraine with the resources that they need to fight this war and to keep their economy running. And this is a way of showing that we have the capacity and the will to do so.”
At a press conference alongside Ukrainian President Volodymyr Zelensky on Thursday, Biden announced the G7 loan, which he said should also serve as a reminder to Putin that “we’re not backing down.”
“In fact, we’re standing together against this illegal aggression,” Biden added.