German chancellor backs EU plan to use frozen Russian assets to fund Ukraine arms

RIGA: Around 90 percent of the revenues generated from Russian frozen assets should be spent on arms purchases for Ukraine, Chancellor Olaf Scholz said on Monday, supporting an earlier EU proposal to use Russian assets’ interest payments to boost Ukraine defence.

“It is important that we also agree that this money can be used for arms purchases not only in the EU, but for purchases worldwide,” Scholz told journalists after a meeting with members of the three Baltic countries governments in Riga.

In March, the European Union’s foreign policy chief Josep Borrell proposed taking take 90 percent of revenues from Russian assets frozen in Europe and transfer them to an EU-run fund that finances weapons for Ukraine.

Some 70 percent of all Russian assets immobilised in the West are held in the central securities depository Euroclear in Belgium, which has the equivalent of 190 billion euros ($204.67 billion) worth of Russian central bank securities and cash.

Germany and the three Baltic states are pushing for a rapid expansion of arms production in Europe, Scholz said, adding production of ammunition and air defence systems had already been increased.