UK to give Ukraine £2.26bn loan to help fight Russia's invasion - but Kyiv won't have to repay a penny

The UK volition springiness Ukraine a £2.26bn indebtedness to bargain weapons and different enactment to combat Russia's invasion, with the wealth efficaciously repaid to the British payer by Moscow.

Rachel Reeves, the chancellor, and John Healey, the defence secretary, person fleshed retired the British publication to a pledge made successful June by the G7 radical of precocious economies to lend Kyiv a full of $50bn (£38.5bn) for its military, fund and reconstruction needs.

Rather than expect Ukraine to wage a penny back, the full indebtedness - erstwhile finalised - volition alternatively beryllium covered by the profits made from hundreds of billions of dollars' worthy of Russian sovereign assets that Western nations person frozen since the commencement of the full-scale warfare successful February 2022.

This mechanics is seen arsenic a mode to unit Vladimir Putin to commencement paying for the harm his penetration has inflicted connected Ukraine - but 1 that has a little hazard of ineligible situation than simply giving the frozen Russian assets straight to the Ukrainian government.

"By utilizing the wealth generated from these sanctioned Russian assets, we tin assistance crook the tables connected Putin's warfare machine," the defence caput said.

"This urgent backing volition straight enactment Ukraine's defence utilizing the proceeds from assets that had helped substance Putin's aggression."

The chancellor declined to springiness a timescale for erstwhile the British indebtedness - which volition beryllium paid successful instalments - volition commencement arriving successful Ukrainian coffers, but said further details would beryllium included successful next week's budget.

"The cardinal happening is we privation to get the wealth retired of the door, but we privation Russia to pay, due to the fact that successful the end, they are liable for what is happening successful Ukraine," Ms Reeves said.

The European Union, including G7 members France, Germany and Italy, has already signalled it volition supply the bulk of the Russian asset-backed indebtedness - up to $39bn (£30bn), portion Canada has pledged to lend Ukraine $5bn (£3.9bn).

But the program remains precarious.

Some two-thirds of the frozen Russian assets, worthy €210bn euros (£175bn), are held wrong the EU but European sanctions connected Russia indispensable beryllium renewed each six months - a determination that requires the backing of each 27 subordinate states.

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It raises a ineligible hazard that a much pro-Moscow state specified arsenic Hungary mightiness artifact the renewal, unfreezing the assets and making the repayment of loans overmuch harder.

The chancellor, however, said she was assured the loans would beryllium recovered from the profits made done the frozen Russian assets.

The US and Japan person yet to acceptable retired the portion they volition play successful the loans for Ukraine but much details are expected this week arsenic concern ministers and cardinal bankers from astir the satellite conscionable successful Washington for an yearly gathering of the International Monetary Fund (IMF).

The UK publication adds to an existing pledge to supply £3bn worthy of subject assistance annually to Ukraine - though this covers everything from grooming and proscription to weapons.

Other G7 nations whitethorn connect conditions connected however their indebtedness tin beryllium spent, but the UK said it was blessed for Ukraine to usage the British offering for immoderate it astir urgently needs - a request that is thought to beryllium focused connected weapons, specified arsenic drones and missiles.