The US wants to receive an additional premium on its share of Ukraine’s €45B loan to compensate for the sanctions-related risks that this agreement carries, wrote Politico.
The premium being negotiated is 1.3% above the cost of Washington’s borrowing in financial markets. It also considers the risk that immobilized Russian assets that will be used to repay the loan may be unfrozen before the amount is fully repaid, which will take about 30 years. Washington’s requested allowance would add another year to the repayment schedule.
The US is the only participant requesting a higher rate of return on its portion of the loan, which is intended to convince Congress that the transaction will not pose a risk to taxpayers. The EU is instead using its €1.2T seven-year budget as collateral.
Washington has repeatedly emphasized the need to extend the EU sanctions, but Hungary’s pro-Russian leader, Viktor Orban, vetoed this decision.