2024-02-23 17:55:00
Since the start of the war in Ukraine, just two years ago, Europe has continued to come to the aid of the country attacked by Russia. To do this, many countries have sent money and weapons, but have also implemented sanctions once morest Russia. Among them, the freezing of Russian assets in Europe.
This Thursday, Alexander De Croo spoke before the House of Representatives: “We are studying how to affect Russian asset freezes. We are doing it together with the G7. But let’s be clear: we must do this on a legal basis. This is the difference between a totalitarian country and a country like ours which respects the rule of law. Let’s not do what Russia would do“.
But what exactly is the Prime Minister talking regarding? Two years following the start of the war in Ukraine and sanctions, nearly 63 billion euros belonging to Russians are frozen in Belgium. Today, Belgium would like to share this sum with Ukraine; this is a pressing request from kyiv.
Roughly 255 billion, out of an amount of 350 billion euros worldwide
These “Russian assets” are of different natures. “For us, it’s almost exclusively money. Either financial securities, therefore bonds, or shares“, tells us Alexandre de Geest, the general administrator of the Treasury Administration of the FPS Finances. The amounts frozen with us are rather staggering: “63 billion euros of assets frozen and 192 billion euros of transactions stopped, which is roughly 255 billion, out of an amount of 350 billion euros worldwide“, he calculates.
Who owns this frozen money? “These are always people who are on the list established by the European Union. They can be individuals or companies, therefore banks. Behind the banks, you obviously have oligarchs, indirectly, and other people or other companies which are not directly targeted by the sanctions.“, specifies Alexandre de Geest.
More than a billion euros raised
Moreover, Russian assets bring us, “indirectly” specifies the general administrator, money “par taxation, particularly corporate tax“.
Euroclear, headquartered in Brussels, is one of the companies that manages Russian assets. It is an international depository and remittance company for financial assets.
Lieve Mostrey, CEO of Euroclear and guest of Martin Buxant on Bel RTL at the beginning of February, spoke precisely regarding this money generated: “What we gain from this is really put aside. It’s really separate in our books and in our reporting. We pay no dividend on these profits“, she explained.
Thus, Euroclear announced in its annual balance sheet that it had paid the Belgian Treasury, for the year 2023, 1.08 billion euros on profits linked to Russian assets blocked in Russia.
Fortunately, these Russian assets frozen in Belgium are profitable and do not cost too much. In Italy, for example, these cost the taxpayer dearly. Some oligarchs have bought villas, gigantic yachts or luxury cars there. However, Italian law requires maintaining these goods in order to be able to return them as is one day. This would cost several hundred thousand euros per month. In Belgium, this is not a problem: “There is no real estate or yacht. I think there are places where it is nicer to own real estate or yachts than in Belgium“, smiles Alexandre de Geert. He admits, however, that there are certain “operation costs“, in order to manage the different files.
Useful sanctions once morest Russia?
The usefulness of these sanctions is, however, contested by some. However, Alexandre de Geert has no doubt: “These are obviously measures that are useful, whatever happens. There is still a lot of money that is, or has been, blocked. The sanctions are not only financial sanctions, they are also embargoes on arms, on parts, etc. So it is much more comprehensive than simply freezing a bank account“.
Especially since the profits from Russian assets, pocketed by Belgium, might be used to rebuild Ukraine. In any case, this is the government’s desire. The Prime Minister indicated that discussions on this subject were underway with the G7. However, this idea may be complicated to apply.
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