G7 agrees $50 billion loan for Ukraine, to be repaid from revenues of frozen Russian assets

G7 leaders agreed on June 13 at their summit in Apulia in southern Italy to provide Ukraine with around $50 billion in loans by the end of the year, to be repaid from extraordinary revenues of immobilised Russian sovereign assets. The mechanism is called ERA (Extraordinary Revenue Acceleration).

After Russia's 2022 invasion, about $280 billion in Russian central bank assets were immobilised in the West, mostly in the European Union at the Belgian depository Euroclear. The revenues from those assets, not the assets themselves, will service the loans. Details of how much each country will contribute have yet to be agreed.

A ten-year agreement

On the sidelines of the summit, US President Joe Biden and Ukrainian President Volodymyr Zelensky signed a ten-year bilateral security agreement committing the US to military assistance, training and defence-industrial cooperation. Ukraine signed a similar agreement with Japan the same day.