Could Using Frozen Russian Assets Solve Ukraine's Funding Problem?

CGTN Europe

CGTN Europe spoke to Dr. Samuel Ramani, Associate Fellow at RUSI think tank and CEO of Pangea Geopolitical Risk.

Transcript

00:00Samuel Romani is the Associate Fellow at the Russi Think Tank and CEO of Pangaea Geopolitical Risk,

00:06and he joins us now.

00:08Thanks so much for joining us.

00:10Sam, we heard a little earlier that Donald Tusk from Poland is saying that there is a bit more of agreement

00:18that these frozen assets from Russia might be used.

00:22Do you think that's the most logical solution to the funding problem?

00:25Yes, I think it probably is the most logical solution to the funding problem.

00:30I mean, obviously, there was a move in that direction over the summer and early fall,

00:34but Belgium, which is where EuroClear is and where the assets are basically held,

00:38was kind of halting and slowing that process.

00:41So if there's been a reversal of opinion there, then I think that we can start seeing the money flowing.

00:47Relying on member state contributions can be quite difficult right now

00:50because there are ongoing concerns among some EU countries about corruption.

00:54For example, there was a bit of a wavering when NABU and SAPO, the two anti-corruption bodies,

00:59were squashed by Zelensky briefly in July before their powers were restored,

01:03and the Timur-Mindic scandal that just unfolded a couple of weeks ago really kind of doubled down on that.

01:08So there will be countries like Hungary and Slovakia saying no.

01:10So given the divisions amongst the member states about the amount of support that's needed

01:14and the lack of support that's coming from the United States at this time,

01:17I think that the frozen assets are probably Ukraine's best bet.

01:20So is that something that if the EU agrees on would even be vaguely acceptable to Russia

01:27or might it be one of the compromises they have to meet when they finally get to that stage of the negotiations?

01:35Well, the Ukrainian peace formula, which is the Zelensky peace formula,

01:39which calls for a complete withdrawal of Russian forces,

01:42also basically had as an auxiliary the need for Russia to pay some kind of reparations for what is done in terms of this invasion.

01:49Obviously, Russia sees that as a non-starter.

01:52It does not challenge the narrative that engaged and provoked aggression against Ukraine,

01:56blaming NATO expansion and blaming the Ukrainian threat to ethnic Russians in Donbass as the reason for their invasion.

02:02So that means that Russia will react very fiercely towards this, could be a major provocation.

02:08And we're already seeing that in some of the Russian media and telegram channels,

02:11where they're basically saying that the United States is trying to push for peace,

02:14Europe wants the war to continue, and they're using financial measures,

02:17including sanctions and asset seizures, as a way to kind of justify or stoke the continuation of the war.

02:23So I suspect that Russia won't respond well to this at all.

02:27Samuel, how hopeful are you that this latest proposal is actually going to bear fruit?

02:31We've kind of been here before.

02:33We are seeing some compromises coming onto the table.

02:36But do you see any spark of hope here?

02:38Well, we've been here definitely before, but I don't think we've been here before to the extent to which

02:44the Europeans and the Americans are actually coming up with points and counterpoints.

02:49I mean, I think in the early months of the Trump administration,

02:52it was really the United States engaging with Russia, and Europe was largely on the sidelines.

02:56So the new dynamic here is this kind of regular U.S.-European consultation.

03:01That being said, Ukraine really doesn't have a scene at the table right now,

03:03even though this settlement is about the future of that country.

03:07And the Ukrainians are vehemently against any kind of unilateral withdrawal from Donetsk

03:11or any kind of cap on their armed forces.

03:14And the Europeans, at least the majority of European countries, likely back that too.

03:18So that's why I think that it's going to be hard to get a deal.

03:21Certainly, MERS was right by saying it's not going to happen by Thursday.

03:23And when I see what's happening in Russia, they're very skeptical if this is going to lead to anything.

03:29And Russian telegram channels are repeat with talking about new plans for offensives in Zaporizhia,

03:34in Holiukov, beyond Pukrovsk.

03:36So I feel like the war is going to continue for some time.

03:38But we are kind of at a good moment in terms of at least some U.S.-European dialogue,

03:43even if there's dramatic disagreements.

03:45All right.

03:46Thank you so much.

03:47Samuel Romani is the associate fellow at the Russi think tank.

03:51He's also CEO of Pangea Geopolitical Risk.

03:55Always great to chat to you, Sam.

03:56Thank you so much.

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