China and Saudi Arabia ask EU not to agree to confiscation of frozen Russian assets

The countries that Moscow calls "friendly" are urging the European Union not to go along with the EU, and after long discussions, the EU itself decided to use only the profits generated by the Bank of Russia's reserves to help Ukraine. However, Brussels is being pushed by the US and the UK to confiscate these assets, and Belgium has proposed using them as collateral for bonds.

Representatives of China, Saudi Arabia and Indonesia are privately asking the EU not to agree to Washington and London's request to confiscate Russian assets frozen since the start of the war in Ukraine, four officials with knowledge of the matter told Politico.

These countries, according to one of them, are "extremely sceptical about the idea," fearing that its implementation would "set a precedent."

Confiscation, which could undermine investors' confidence in the euro and make them invest less in European securities, is also feared in the EU itself. The European Central Bank has warned about this.

That is why the countries of the bloc decided to use only the profits generated by bonds held in the Euroclear depository, purchased by the Bank of Russia for €190 billion. This is approximately 3-4 billion euros a year, and 90% of the proceeds will be used to buy weapons for Ukraine.

In addition, Politico writes that countries friendly to Russia may not be interested in Europe helping Ukraine defeat the Russian army.

"I suppose the Russians could have asked their friends to create this hype," a senior non-EU diplomat told the publication.

Both the military escalation and Russia's defeat are not in the interests of the Gulf states, said Theodore Karasik, senior adviser at Gulf State Analytics: they "do not want Russia to collapse" because of their business ties and investments with it.

Meanwhile, in the US, congressmen from both parties introduced the REPO Act last year, which allows the president to confiscate Russian reserves ($5-8bn) and use them to help Ukraine.

On Sunday, House spokesman Mike Johnson said he would try to reach a consensus among lawmakers in April on new proposals to support Kyiv. Among these proposals, Johnson mentioned the adoption of the REPO Act.

Background. As it became known, the US Congress will submit to Biden a project to help Ukraine confiscate Russian assets. It is noted that the bill will allow for the confiscation of $5-8 billion of Russian assets.