File: Firefighters work at a site of residential house destroyed by a Russian missile strike, as Russia’s attack on Ukraine continues, in Kramatorsk, Ukraine July 29, 2022. Press service of the Donetsk Regional Military Administration/Handout via REUTERS
- Highlights
- U.S. and Russia hold Ukraine ceasefire talks in Saudi
- Most seized Russian assets are held in Europe, not U.S.
- Senators want Trump administration to explain strategy
WASHINGTON – A group of Republican and Democratic U.S. senators is pushing President Donald Trump’s administration to transfer – and push allies to transfer – more than $300 billion of seized Russian assets to help Ukraine, not just use the debt’s interest to support Kyiv.
“How does the Administration view using all financial tools at its disposal to increase pressure on Russia to end the war?” the senators asked in a letter sent to Secretary of State Marco Rubio and seen by Reuters on Monday.
“Specifically, does the Administration believe that U.S. and EU-held assets should be used as leverage in negotiations with Russia to bring an end to the war? If so, how?” the letter asked.
The letter was signed by Republicans Todd Young and Lindsey Graham, and Democrats Richard Blumenthal and Tim Kaine.
The letter is a rare example of senior Republicans publicly pressing the Trump administration to be tougher with Moscow.
Pro-Ukraine Republicans in Congress have been largely quiet since Trump tilted U.S. policy more toward Russia, which started the war with its full-scale invasion of Ukraine in 2022.
The State Department did not immediately respond to a request for comment.
The letter was sent on Friday. It comes as U.S. and Russian officials held talks in Saudi Arabia on Monday aimed at sealing a Black Sea maritime ceasefire deal before a wider ceasefire agreement to end the three-year-long war in Ukraine.
Members of the U.S. Congress have been calling for years for seized Russian assets to be used to rebuild Ukraine, both to avoid spending more American taxpayer dollars on the conflict and to put pressure on Moscow to reach a peace deal.
In their letter, the senators asked if the administration intends to develop a strategy to encourage the EU, G7 and other allies to leverage sovereign Russian assets. They also asked if the administration would support Ukraine using Russian sovereign assets under U.S. control to purchase defense equipment.
After Russian President Vladimir Putin sent troops into Ukraine in 2022, the United States and its allies prohibited transactions with Russia’s central bank and finance ministry, blocking $300-$350 billion of sovereign Russian assets.
They are mostly European, U.S. and British government bonds held in a European securities depository. Sources said only about $7 billion is held in U.S. financial institutions.
POTENTIAL LEGAL CHALLENGES
European leaders want to use those assets to help rebuild Ukraine, but have yet to reach an agreement on how to avoid legal challenges or set a problematic international precedent, with several options under consideration.
European and U.S. officials have agreed to use windfall profits from interest on the frozen Russian assets to back loans to Ukraine, but not the assets themselves. The lawmakers said they understood that the U.S. also does not want to seize the assets themselves and said they “seek to understand the Administration’s position on this issue.”
Russia has said plans to use the funds for Ukraine amounted to robbery, although sources told Reuters last month that Moscow could agree to using assets frozen in Europe for reconstruction but would insist part of the money be spent on the one-fifth of the country that its forces control.
The U.S. Congress in 2024 also passed the “Rebuilding Economic Prosperity and Opportunity for Ukrainians Act,” signed into law by former President Joe Biden that April. The legislation gave the U.S. president the authority to transfer Russian assets seized in the U.S. to Ukraine.
Washington has never before seized central bank assets from a country with which it is not at war.
(Reuters)