The finance ministers of the Group of Seven major industrialized nations (G7) will pledge multibillion-dollar aid to Ukraine and promise enough funds to keep its war-torn economy afloat. The war with Russia continues for some time.
Finance ministers and central bankers from the United States, Japan, Canada, Britain, Germany, France and Italy are also discussing next steps in sanctions against Russia to push the Kremlin to end the February 24 war.
In a draft G7 announcement expected later, officials say $ 18.4 billion in additional support for Ukraine’s budget this year, along with $ 9.2 billion from previous commitments. .
“The message we are sending is ‘We support Ukraine,'” US Treasury Secretary Janet Yellen said on Thursday. “We will raise the resources needed to do this,” he added.
Today’s discussions will also focus on the risk of new debt crises arising from the rapid rise in food and energy prices, the progress made in corporate tax reform globally, efforts to switch to renewable energy sources, but and the current state of the pandemic.
G7 officials are also discussing proposals to reduce Russia’s energy export revenues, including a phased-in embargo proposed by the European Commission, setting up a buyer cartel to push up Russian crude prices and tariffs on Russian oil.
The latest proposal was presented by the US as a way to limit Moscow’s oil profits, while ensuring that supplies are maintained in the market to avoid a price rally.
“We have not yet come up with a clear strategy,” Yellen said in a statement.
Another G7 official said that price and tariff ceilings are problematic proposals as producers will have little incentive to comply and consumers may have to bear all the extra costs in the end.
In the draft, the G7 welcomes the Commission proposal for a € 9 billion loan to Ukraine. It also notes that the European Bank for Reconstruction and Development, and the International Monetary Fund, plan to provide $ 3.4 billion in support, although it is unclear whether this is included in the $ 18.4 billion package.
Yellen also noted that the US Congress overwhelmingly passed the $ 40 billion package for Ukraine, with $ 7.5 billion going to new financial assistance.
The G7 finance ministers and central bankers will also look at inflation and discuss how sanctions pressure on Russia can be increased without causing a recession.
“The G7 central banks are closely monitoring the impact of price pressures and inflation expectations and will continue to adjust the pace of monetary policy tightening based on incoming data,” the draft said.
This will ensure that “inflationary inflation will remain stable, while at the same time attention will be paid to protecting the recovery and limiting the potential negative cross-border effects”.
Source: Capital
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