G7 leaders agree on US$50B loan for Ukraine using frozen Russian assets – National

A Group of Seven summit opened Thursday with agreement reached on a U.S. proposal to back a US$50 billion loan to Ukraine using frozen Russian assets as collateral, giving Kyiv a strong show of support even as Europe’s political chessboard shifts to the right.

Italian Premier Giorgia Meloni welcomed the G7 heads of state to the summit at a luxury resort in southern Italy, saying she wanted the message of this meeting to be one of dialogue with the global south and unity.

She likened the G7 to the ancient olive trees that are a symbol of the Puglia region, “with their solid roots, and branches projected toward the future.”


Click to play video: 'Trudeau heads to G7 summit in Italy'


Trudeau heads to G7 summit in Italy


Beyond the the war in Ukraine, Pope Francis will become the first pope to address a G7 summit, adding a dash of celebrity and moral authority to the annual gathering. He’ll be speaking Friday about the promises and perils of artificial intelligence, but is expected to also renew his appeal for a peaceful end to Russia’s full-scale invasion of Ukraine and the Israel-Hamas conflict in Gaza.

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The G7 includes Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. Italy, which is hosting the summit, has invited several African leaders — Algerian President Abdelmadjid Tebboune, Kenyan President William Ruto and Tunisian President Kais Saied — to press Italy’s development and migration initiatives on the continent.

Other guests include Ukrainian President Volodymyr Zelenskyy, Brazilian President Luiz Inácio Lula da Silva, Indian Prime Minister Narendra Modi, fresh off his own election, and Turkish President Recep Tayyip Erdogan.

With Biden, U.K. Prime Minister Rishi Sunak and now French President Emmanuel Macron facing elections in the coming months, pressure was on the G7 to get done what it can while the status quo lasts.

Frozen Russian assets to support Ukraine

Leaders of the G7 countries have agreed to engineer a US$50-billion loan to help Ukraine in its fight for survival that would use interest earned on profits from Russia’s frozen central bank assets as collateral.

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The U.S. proposal involves engineering the loan to help Ukraine in its fight against Russia that would use interest earned on profits from Russia’s frozen central bank assets, most of them held in the European Union, as collateral.

A senior government source told the Canadian Press that Canada is prepared to contribute $5 billion toward a loan to Ukraine that will be based on future revenue from frozen Russian assets

The source, who is not being named because they are not authorized to discuss details publicly, says G7 leaders are finalizing details of the loan.


Click to play video: 'Canada urges G7 to provide financial aid to Ukraine using seized Russian assets'


Canada urges G7 to provide financial aid to Ukraine using seized Russian assets


A French official, briefing reporters Wednesday, said a political decision by the leaders had been reached but that technical and legal details of the mechanism to tap into the assets still had to be worked out. The issue is complicated because if the Russian assets one day are unfrozen — say if the war ends — then the windfall profits will no longer be able to be used to pay off the loan, requiring a burden-sharing arrangement with other countries.

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In addition to the deal, Sunak announced up to 242 million pounds (286 million euros or $310 million) in nonmilitary aid to Ukraine for humanitarian, energy and stabilization needs. Washington also sent strong signals of support, with widened sanctions against Russia to target Chinese companies that are helping its war machine.

Europe’s new political chessboard

Meloni goes into the meeting fortified at home and abroad after her far-right party had an even stronger showing in the European Parliament election than the national general election in 2022 that made her Italy’s first female premier. Known for its revolving-door governments, Italy is now in the unusual position of being the most stable power in the EU.


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The leaders of the G7’s two other EU members, Germany and France, didn’t fare nearly as well, rattled after hard-right parties made strong showings in the vote. Macron called a snap election and German Chancellor Olaf Scholz saw his Social Democrats finish behind mainstream conservatives and the far-right Alternative for Germany.

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As a result, Meloni is likely to be able to steer the three-day meeting to her key priority items as she further cements her role on the world stage, analysts said. One sign of her flexed far-right muscles: Meloni’s office denied media reports that Italy was trying to water down language about access to abortion in the final communique.


Click to play video: 'EU election: Europeans react as several far-right parties emerge victorious'


EU election: Europeans react as several far-right parties emerge victorious


A French official, speaking anonymously in line with Macron’s office customary practices, said there were diverging views with Italian negotiators on some topics, including on sexual and reproductive health and vaccines.

Italian Foreign Minister Antonio Tajani confirmed abortion was being discussed, but said discussions were continuing.

“While it’s unlikely the recent results will radically shift the focus of the upcoming G7 Summit, this electoral win offers Premier Meloni additional leverage to frame this as an essentially ‘Mediterranean Summit,” said Nick O’Connell, deputy director of the Atlantic Council.

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That includes pushing her migration agenda as Meloni seeks to leverage her program for a nonexploitative relationship with Africa to boost development while curbing illegal migration to Europe.

The pope and artificial intelligence

Pope Francis has called for an international treaty to ensure AI is developed and used ethically, acknowledging the promise it offers but emphasizing the grave and existential threats it poses.

He’ll bring that campaign to the world’s industrialized countries as wars are raging across multiple fronts. One of his greatest concerns has been on the use of AI in the armaments sector, which has been a frequent focus of the Jesuit pope who has called even traditional weapons makers “merchants of death.”

But Francis is also concerned about what AI means for the poorest and weakest: technology that could determine the reliability of an applicant for a mortgage, the right of a migrant to receive political asylum or the chance of reoffending by someone previously convicted of a crime.

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Tech Talk: Digital ID’s and Apple Intelligence


The G7 summit is taking place in a sprawling luxury resort that’s something of a theater set, a faux town made to resemble one of Puglia’s medieval white-washed hamlets but that actually only dates from 2010.

Located next to an actual archaeological park, Borgo Egnazia features narrow streets, villas, restaurants and a town square complete with a clocktower. A favorite of celebrities, it will be sealed off to outsiders for the duration of the summit.

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No such five-star accommodations await the 2,000-plus police and Carabinieri forces who have been brought in to provide security. Authorities on Wednesday sequestered the decommissioned cruise ship that had been housing them in Brindisi’s port, after the police union complained about unacceptable hygienic conditions on board.

As with any G7, an assortment of anti-global, anti-war and climate activists are staging protests around the summit venue, but far from where the leaders are meeting. One group is staging a “dinner for the poor” on Friday night calling for “peace, the rights of peoples and against the Big 7 who claim to decide the destiny of the world and our planet.”


Click to play video: 'G7 summit: Ukraine urges nations to supply more air defence against Russian attacks'


G7 summit: Ukraine urges nations to supply more air defence against Russian attacks


The three-day summit is an opportunity for collaboration among the leaders of the wealthy democracies — France, Italy, Germany, the United Kingdom, the United States, Canada and Japan.

Ukraine is expected to be a major agenda item for the leaders as the U.S. pushes to reach an agreement on Russian assets.

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Prime Minister Trudeau is scheduled to have meetings with German Chancellor Olaf Scholz, French President Emmanuel Macron and Ukrainian President Volodymyr Zelenskyy.

He is also set to participate in working sessions with other leaders on collaboration with Africa, climate change, the Middle East and Ukraine.

Trudeau is headed to Switzerland on Saturday to attend a summit on Ukraine, where a larger group of countries will meet to discuss a future path to peace.

Nicole Winfield reported from Bari. Angela Charlton and Sylvie Corbet contributed to this report from Paris.

— with files from The Canadian Press.

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