Germany is open to using billions of euros in frozen Russian assets to help Ukraine rebuild once legal issues are resolved and allies follow suit. This is reported by Bloomberg.
According to the newspaper, the government of Chancellor Olaf Scholz supports Ukraine's demand for military reparations, but has not yet taken an official position on the confiscation of Russian assets. The issue is complex and some parts of the ruling coalition are more heated than others, according to people familiar with the discussions.
The internal tension reflects the wider struggle of the international community to form a common position. If Berlin can resolve its problems, it could give new impetus to discussions in the European Union and put pressure on the US to seize assets, such as central bank reserves, frozen in response to the Russian invasion.
German Foreign Minister Annalena Burbok demands compensation from Russia for the damages caused to Ukraine. The former Greens leader, a longtime advocate of a tougher stance on the Kremlin, is pushing for at least some of the frozen assets to be seized.
German Finance Minister Christian Lindner is concerned that confiscating the assets of the Russian Central Bank could set a dangerous precedent and lead European countries and their allies into a legal quagmire.
It was noted that the EU and G7 partners froze about 300 billion euros in the reserves of the Russian Central Bank of the Russian Federation. The EU has also frozen around €19 billion in assets of Russian businessmen under sanctions, although these estimates are not complete. Assets are suspended and cannot be distributed.
According to the source, instead of general confiscation, targeting the assets of individuals proven to be involved in Russian war crimes could be a more profitable path from a legal point of view. However, such cases can take years to be considered.
The details of the discussions show how the potential for asset forfeiture is moving beyond theoretical debate and into implementation, but major obstacles remain. German Chancellor Olaf Scholz wants any moves to be coordinated with allies as well as legally tough.
