The News
The European Union has begun drafting a new proposal to raise up to $44 billion in loans for Ukraine.
The loan could offer a plan B after a previous proposal drafted by the “group of seven” member states to use frozen Russian assets to back Ukraine was vetoed by Hungary, whose Prime Minister Viktor Orbán is sympathetic to the Kremlin’s cause.
The frozen-assets program is still Europe’s plan A, the Financial Times wrote, but if it collapses, Brussels may try to raise its own money.
The EU has sought to extend the freeze on Russian assets, from a rolling six-month stretch to 36 months, with the aim of providing more legal and financial stability to Ukraine.
SIGNALS
Hungary’s presidency of EU Council is an obstacle to the bloc’s decisions
Hungarian Prime Minister Viktor Orbán has undermined the European Union’s support for Ukraine, particularly in the period since he took on the rotating presidency of the Council of the European Union in July. At that point, Orbán became “the extension of Russia’s foreign policy,” an analyst told Foreign Policy. The Hungarian PM repeatedly violated EU rules by falsely claiming to represent the bloc while on self-declared “peace missions” to several countries, including Russia. Orbán’s siding with Moscow is as much personal as political, Foreign Policy added: “It’s not that Orbán loves Putin. It’s that he hates the West.”
Outcome of decision could change after US election in November
Viktor Orbán has suggested that any decisions on further European funds for Ukraine should wait until after the US’ presidential election in November, when the calculus could change dramatically depending on which candidate wins, Voice of America wrote. A second Trump presidency would be likely unpredictable, beyond his promise to end the conflict. “It’s not entirely clear how he’ll do that,” a foreign policy expert told the outlet. Harris, on the other hand, has repeatedly expressed support for Ukraine, and has seemed committed to preserving Biden’s policy there.
IMF prepares to return to Russia in ‘symbolic victory’ for Putin
While the European Union discussed more funding to Ukraine, the International Monetary Fund was set to become the first major international financial body to return to Russia, with staff apparently returning to Moscow by the end of the week. Some European countries have expressed “anger and dismay” at the announcement, while other experts have argued that the IMF may help Russia improve its economy and strengthen it in its fight against Ukraine, The Guardian noted. The move is a “symbolic victory” for Putin, and could project a “false veneer of legitimacy for the Kremlin,” experts argued in Fortune.