On Thursday, the leaders of the Group of Seven (G7) major democracies agreed on an initial deal to provide $50 billion in loans to Ukraine, funded by interest from Russian sovereign assets frozen following Moscow’s 2022 invasion of Ukraine.
This political agreement was the highlight of the first day of the annual G7 summit in southern Italy, attended for the second consecutive year by Ukrainian President Volodymyr Zelenskiy. He also signed a new, long-term security accord with U.S. President Joe Biden, following a 10-year security accord with Japan, which has pledged $4.5 billion to Kyiv this year, demonstrating continued strong support from the West.
Calling the frozen asset agreement a “significant outcome,” Biden told reporters it was “another reminder to (Russian President Vladimir) Putin that we’re not backing down.”
The G7’s plan for Ukraine involves multi-year loans derived from profits on approximately $300 billion of frozen Russian funds, primarily held in the European Union. The technical details will be finalized in the coming weeks, with the new funds expected to reach Kyiv by the end of this year, thanks to contributions from all G7 states—the United States, Canada, Britain, France, Germany, Japan, and Italy.
“This is a very clear commitment that should embolden the Ukrainians to do what they need to defend their independence and sovereignty,” said German Chancellor Olaf Scholz.
The deal aims to ensure longevity irrespective of political changes in G7 states, addressing concerns that U.S. Republican presidential candidate Donald Trump might be less supportive of Kyiv if he wins the upcoming election, according to sources close to the talks.
Russia views the West’s attempts to use income from its frozen assets as criminal, with foreign ministry spokeswoman Maria Zakharova warning of a very painful response for the European Union.
STRUGGLES AT HOME
Many G7 leaders face challenges at home but aimed to project confidence on the world stage as they tackle issues such as China’s economic ambitions, the growth of artificial intelligence, and turmoil in the Middle East.
The leaders voiced concerns about the Israel-Lebanon border situation and endorsed U.S. efforts to secure a ceasefire in the Gaza conflict, according to a draft communique to be released post-summit. They also urged Israel to avoid a full-scale offensive in Rafah, southern Gaza, “in line with their obligations under international law.”
Western nations are expected to express unanimous concern over China’s industrial overcapacity, which they argue distorts global markets, and their determination to help African states develop their economies, diplomats said.
The G7 could look quite different next year. Biden faces a tough re-election battle in November, British Prime Minister Rishi Sunak is likely to lose power in the upcoming national election, and French President Emmanuel Macron dissolved his country’s parliament after his party’s poor performance in the European vote.
All leaders smiled broadly as they greeted Italian Prime Minister Giorgia Meloni under a blazing Mediterranean sun at the entrance to the Borgo Egnazia resort, where the summit is being held. However, unity was challenged late in the day when Macron clashed with the anti-abortion Meloni over Italy’s push to remove any direct reference to abortion rights in the final communique.
Over a dozen outside leaders will join the discussions on Friday, including those from India, Brazil, Argentina, Turkey, Algeria, and Kenya, with Pope Francis set to speak about the risks and potential of artificial intelligence.
