Former World Bank President Robert B. Zoellick has called on Western countries to not hesitate to use the frozen assets of the Central Bank of the russian federation to help Ukraine. He also believes that some of the funds should be sent to developing countries and companies affected by the introduction of anti-russian sanctions.
The former head of the World Bank wrote about this in a column for the Financial Times.
Zoellick wrote that Western fears of transferring frozen russian assets to Ukraine are overstated and deprive the country of the necessary funds.
He urged Western countries not to hesitate to take advantage of these assets, since there is no real risk to international financial stability.
“Russia is waging a war of attrition against Ukraine. Ukraine’s friends need to send a signal that Moscow cannot outlast Kyiv; it is elegant justice to do so with Russia’s own assets,” Zoellick wrote.
Since the start of russia's full-scale invasion of Ukraine, the West has frozen more than USD 300 billion in russian foreign exchange reserves. While those funds have remained intact ever since, fluctuations in Kyiv's Western financial support have sparked a debate over whether they could be a source of assistance.
Critics argue that such an arrest would undermine the willingness of the international community to hold reserves in dollars, spurring an accelerated move to abandon the dollar.
Zoellick believes that the unity of the West in the use of frozen assets of the russian federation will deprive dissatisfied countries of real alternatives.
He added that while central banks in other countries could invest in gold, it lacks liquidity and other currencies do not have the same influence as the U.S. dollar.
“China and other economies do not hold dollars or euros because they are friends with Europe and the US. Rather, they run trade surpluses that earn foreign currencies. If Beijing dumped its dollars or euros for renminbi, it would have to figure out where to invest the proceeds at the same time that it undermined its exporters’ exchange rate, thus hurting its trade,” Zoellick said.
By guaranteeing Kyiv funding for recovery and reconstruction, the West can stimulate Ukraine to reach a settlement with russia as soon as possible.
On the other hand, there is a small chance that the G7 will offer russia to return some of the assets in exchange for real peace.
As Ukrainian News Agency earlier reported, on January 6, President Volodymyr Zelenskyy called on international partners to accelerate the creation of a legal framework that would allow the seizure of frozen assets of the Central Bank of the russian federation to help Ukraine.
Recall, on January 11, Bloomberg reported that the administration of U.S. President Joe Biden supports a bill on the confiscation of frozen assets of the russian federation for their further transfer to Ukraine.
We also reported that russia is already working with leading legal organizations to challenge the confiscation of its frozen assets through the courts.
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