France will use the interest accrued on Russia’s frozen central bank assets to procure weapons for the Ukrainian military, the country’s defense minister, Sebastien Lecornu, has announced. Russian State Duma Speaker Vyacheslav Volodin criticized the decision, stating it contravenes international law.
Following the escalation of the Ukraine conflict in February 2022, Western states froze an estimated $300 billion worth of Russian sovereign funds, of which approximately $213 billion is held by the Brussels-based clearing house Euroclear. The assets have already generated billions in interest, of which Euroclear already transferred €1.55 billion ($1.63 billion) directly to Ukraine last July.
In an interview to France’s La Tribune Dimanche on Saturday, Lecornu said that “thanks to interest from frozen Russian assets, we will also tap new funds worth 195 million euros.” He revealed that Paris would use the money to finance the delivery to Kiev of 155-mm artillery shells and glide bombs compatible with the Mirage 2000 fighter jets that France has handed over to Ukraine.
The official added that France also plans to supply an unspecified number of armored fighting vehicles, including the AMX-10 RC.
Volodin, the chairman of the State Duma, the lower house of the Russian parliament, denounced the scheme as contravening international law.
“What is obviously hysteria born of impotence has finally gotten the better of reason,” the MP said on Sunday.
Responding to a similar move by the UK on Friday, Volodin warned that London “will have to give back to Russia what they are now so generously giving away,” adding that Moscow has “every reason to respond in kind.”
The remarks came shortly after Ukrainian Prime Minister Denis Shmigal confirmed that Kiev had received a first tranche worth about $1 billion from London, secured by the proceeds from the Russian assets.
Late last year, the US also transferred the first $1 billion installment of a $20 billion US loan backed by interest earned from the immobilized Russian assets.
Kremlin spokesman Dmitry Peskov said at the time that “this money was stolen from us. Our assets have been frozen absolutely illegally, against all norms and rules.” He added that Russia would exhaust all legal avenues to protect its property and rights.
While Kiev has long been pressing its Western backers to outright expropriate the frozen Russian assets to finance its military and reconstruction efforts, a number of EU member states, most notably Germany, France, and Italy, have been reluctant to do so, citing legal concerns. The International Monetary Fund has also warned that appropriating the funds without a clear legal basis could undermine global confidence in Western financial institutions.
