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Saturday, July 20, 2024

Joe Biden Declares ‘Democracies Can Deliver’ as G7 Approves $50bn Aid Deal for Ukraine

Joe Biden declared that “democracies can deliver” as he announced that the leaders of the G7 Western economies had finally reached an agreement to mobilize an additional $50 billion (£39 billion) in aid for Ukraine, using frozen Russian state assets.

Speaking at the G7 summit in Puglia, Italy, on Thursday, Biden celebrated the breakthrough as he met with Ukraine’s President Volodymyr Zelenskyy. He also announced that the two countries had signed a 10-year bilateral security agreement, ending a year of challenging negotiations.

“We are putting our money to work for Ukraine, and giving another reminder to Putin that we are not backing down,” Biden said at a joint press conference with Zelenskyy.

Biden also mentioned that arrangements were being made to provide Ukraine with five Patriot missile defense systems, stating, “Everything we have is going to Ukraine until its needs are met.”

However, he ruled out using US weapons to strike deeper into Russia beyond the bases being used to attack the Ukrainian city of Kharkiv. “In terms of longer-range weapons into the interior of Russia, we are not changing our positions,” he said.

Zelenskyy described the deal as the “strongest agreement” since Ukraine’s independence in 1991. “Today is a truly historic day,” he said.

He also highlighted the security guarantee as a “very detailed legally binding agreement” that lasts beyond the war. The deal covers intelligence cooperation and the strengthening of Ukrainian defense industries.

Zelenskyy mentioned that Chinese President Xi Jinping assured him that Beijing would not sell weapons to Russia. “He gave me his word,” he said. However, Biden argued that China was indirectly arming Russia by supplying technology and dual-use components.

Earlier, Biden encouraged Western leaders to stand strong against the populist right, saying, “We stand at an inflection point in history that occurs every five or six, seven generations, and the decisions we make now will determine the course of our future.

Also Read: Ukraine to Sign Security Agreements with Japan and the US at the G7 Summit

“I’m proud to announce that the US has mobilized more than $50 billion in investments around the world. Together we are showing that democracies can deliver.”

His remarks followed the G7 reaching a provisional agreement to use profits from frozen Russian sovereign assets to underwrite a $50 billion loan for Ukraine, aimed at mitigating the impact of Russian military attacks.

The agreement, developed through complex legal discussions over the past three months, will establish a special fund by the end of the year. The funds will flow through multiple channels to support Ukraine’s military budget and reconstruction needs.

A loan syndicate will be formed, with multiple lenders sharing the risk. The scheme will not be solely managed by the EU or the US. Interest on the loan will be funded from the profits derived from the frozen Russian state assets.

One of the unresolved issues was the risk of default. Some argued for immediately transferring the entire tranche of Russian state assets to Ukraine as compensation for Russia’s unlawful attack, but faced resistance from the IMF, which warned of potential damage to the financial system’s stability.

The funds are not expected to be provided in a lump sum, which posed concerns for Ukraine that EU states might delay planned aid. US officials doubted Ukraine’s capacity to absorb such a large sum at once and its potential impact on inflation.

Jake Sullivan, the US national security adviser, said, “The simple proposition is we got to put these assets to work. The complex proposition is how you do that specifically. I think we are on the verge of a good outcome.”

The goal is to ensure the loan proceeds reach Ukraine before the US presidential elections in November, making it difficult for any subsequent Trump administration to undo the fund.

The bilateral security agreement between the US and Ukraine, the 16th such agreement for Ukraine, remains unpublished. As an executive order, it could be reversed by a Trump administration, but the accumulation of agreements collectively provides security assurance. While not a substitute for full NATO membership, it aims to deter Russia from further aggression. Ukraine remains committed to seeking NATO membership.

Regarding another major conflict, G7 leaders are waiting to see if Egypt and Qatar can persuade Hamas to moderate their proposed amendments to the Biden peace plan. The draft G7 communiqué expresses concerns about Israel’s ongoing operations in Rafah but does not explicitly call for a cessation or outline consequences for continued actions.

The draft statement reads: “We are concerned about the consequences of the ongoing ground operations in Rafah on the civilian population and the possibility of a large-scale military offensive that would have further disastrous consequences for civilians. We call on the government of Israel to refrain from such an offensive, in line with its obligations under international law.”

It also urges all parties to refrain from unilateral actions undermining the prospect of a two-state solution, including Israeli settlement expansion and the “legalization” of settlement outposts. The statement condemns the increase in extremist settler violence against Palestinians, which undermines security and stability in the West Bank and threatens the prospects for lasting peace.

The statement reaffirms a commitment to the vision of a two-state solution, with Israel and Palestine coexisting peacefully within secure, recognized borders. It also calls for recognizing a Palestinian State at an appropriate time and suggests that Gaza and the West Bank should be jointly administered by the Palestinian Authority.

John Collins
John Collins
John is an esteemed journalist and author renowned for their incisive reporting and deep insights into global affairs. As a prominent contributor to City Telegraph, John brings over 5 years of experience covering diverse geopolitical landscapes, from the corridors of power in major capitals to the frontlines of conflict zones.

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