Putin calls G7 deal on frozen Russian assets for Ukraine loan ‘theft’

Western countries have agreed to use interest on frozen Russian assets to give Ukraine a $50bn loan.

Russia’s President Vladimir Putin has denounced an agreement by Western countries to provide Ukraine with a loan package using frozen Russian assets and pledged retaliation.

Speaking at a meeting on Friday with officials from the Ministry of Foreign Affairs, Putin said leaders in the West were trying to come up with “some kind of legal basis” for the asset freezes, “but despite all the trickery, theft is still theft and will not go unpunished”.

He added that Moscow’s treatment was proof that “anyone” could be next and punished by an asset freeze.

Putin’s comments came after the Group of Seven (G7) members agreed at a summit in Italy on an outline deal for a $50bn loan package for Ukraine to help it acquire weapons and rebuild destroyed infrastructure using interest from Russian sovereign assets frozen after Putin sent his troops into the neighbouring country in February 2022.

The G7 comprises Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. The European Union also participates in all discussions.

Following the deal’s announcement at the annual summit in Puglia (Apulia), US President Joe Biden said the frozen assets agreement was a “significant outcome” and “another reminder to Putin that we’re not backing down”.

The details of the agreement are expected to be finalised in the coming weeks, and the money is expected to reach Ukraine by the end of the year.

However, Russia’s Foreign Ministry spokeswoman Maria Zakharova dismissed the deal on Friday, saying it was “just pieces of paper”.

“These agreements are about nothing. They do not have legal force,” Zakharova was quoted by Russian news agencies as saying.

‘Point of no return’

In separate comments, Putin said the world had reached a “point of no return”, adding that the collapse of the “Western model” of global security required a new and more stable system in its place.

“Obviously, we are witnessing the collapse of the Euro-Atlantic security system. Today it simply does not exist, it needs to be essentially created anew,” Putin said.

“All this requires us, together with our partners, with all interested countries, and there are many of them, to work out our own options for ensuring security in Eurasia, proposing them then for wider international discussion.”

The Russian president added that his country was open to discussing a new security system with everyone, including the US-led NATO military alliance.

“It is important to proceed from the fact that the future security architecture is open to all Eurasian countries that wish to take part in its creation. ‘To all’ means European and NATO countries too, of course,” he said.

“We live on the same continent. No matter what happens, you cannot change the geography, we will have to coexist and work together one way or another.”