Ukraine to get £2.26bn loan from UK to help fight Russian invaders, and won’t have to pay it back
The UK government will give an extra £2.26bn ($2.93bn) to Ukraine to buy weapons, using the profits from seized Russian assets held in Europe. The cash forms Britain’s contribution to a £38bn ($50bn) fund announced in June by members of the G7 group of leading economies.
Defence Secretary John Healey said the new money will help Ukraine bolster its frontline military equipment. He described it as “turning the proceeds of Putin’s own corrupt regime against him, by putting it into the hands of Ukraine”.
Chancellor Rachel Reeves said the aim was to release the money as quickly as possible. The funds will be made in the form of a loan – with the UK recouping the cost from profits of seized Russian assets – “within the correct legal framework”.
Reeves made it clear that the UK was not confiscating sovereign Russian assets in Europe but using the profits and interest accrued from them. Other G7 countries have pledged to do the same and are expected to finalise their contributions in the coming weeks. The payments to Ukraine are expected to be made in tranches, rather than all at once. Some nations expect some of the money to go towards Ukraine’s reconstruction. But the UK government has said it is up to Kyiv on how it spends the UK’s contribution. Healey said the money announced would allow Ukraine to purchase crucial military equipment, such as air defences and ammunition. The £2.26bn is a one off payment. But it is an addition to the £3bn already pledged by the government to fund Ukraine’s war effort.
So far, the UK has given more than £12bn in military aid and has promised to match that level of support in the future. The chancellor and defence secretary briefed reporters on the announcement sitting side by side. Reeves said it showed the UK’s support for Ukraine was “unwavering and will remain for as long as it takes”. Their appearance together might also signal a positive relationship ahead of next week’s Budget, when the government will outline its spending plans on public services such as health, schools and police. Reeves was asked about defence spending and repeated that the government had committed to spending 2.5 per cent of GDP – though without a timetable. The chancellor said she was not going to discuss details of the forthcoming budget.
Chancellor of the Exchequer Rachel Reeves, said: “Our support for Ukraine and her men and women in their fight for freedom from Putin’s aggression is unwavering and will remain so for as long as it takes.“ This new money is in Britain’s national interest because the frontline of our defence – the defence of our democracy and shared values – is in the Ukrainian trenches. A safe and secure Ukraine is a safe and secure United Kingdom.”
Defence Secretary John Healey, added: “By using the money generated from these sanctioned Russian assets, we can help turn the tables on Putin’s war machine. This urgent funding will directly support Ukraine’s defence using the proceeds from assets that had helped fuel Putin’s aggression. The UK is stepping up our support to Ukraine, speeding up supplies of vital equipment and boosting our defence industries. We will stand with Ukraine for as long as it takes.”
