G7 agrees billions in aid for war-torn Ukraine

THE G7 nations have agreed to provide 19.8 billion US dollars (£15.8 billion) in economic aid to Ukraine to ensure its finances do not hinder its ability to defend itself from Russia’s invasion.

German finance minister Christian Lindner said that 9.5 billion dollars (£7.6 billion) of the total was mobilised at meetings of the G7 finance ministers in Koenigswinter, Germany, this week.

“We agreed that Ukraine’s financial situation must have no influence on Ukraine’s ability to defend itself successfully,” he said. “We need to do our utmost to end this war.”

Russia’s invasion touched on almost every topic of the finance ministers’ meetings this week, from the need to reduce reliance on Russian energy to reforming relationships between countries to maintain economic stability.

“Russia’s war of aggression is causing global economic disruptions, impacting the security of global energy supply, food production and exports of food and agricultural commodities, as well as the functioning of global supply chains in general,” a G7 statement said.

US treasury secretary Janet Yellen and other leaders spoke this week about the need for allies to put together enough additional aid to help Ukraine “get through” the Russian invasion.

“All of us pledged to do what’s necessary to fill the gap,” Ms Yellen said on Thursday as the ministers finished their first of two days of talks.

“We’re going to put together the resources that they need.”

The finance ministers of the G7 – which includes Canada, France, Germany, Italy, Japan, the UK and the US – have also grappled with deepening inflation, food security concerns and other economic issues during their talks.

As the finance ministers were meeting in Germany, the US overwhelmingly approved its own 40 billion dollar (£32 billion) infusion of military and economic aid for Ukraine and its allies.

The legislation was backed by every voting Democrat and most Republicans.

Meanwhile, Russia will cut off natural gas to Finland after the country that applied for Nato membership this week refused President Vladimir Putin’s demand to pay in roubles, the Finnish state-owned energy company has said. Finland is the latest country to be cut off from an energy supply that is used to generate electricity and power industry after refusing Russia’s decree.

Poland and Bulgaria were cut off late last month but had prepared for the loss of gas or are getting supplies from other countries. Finland refused the new payment system, with energy company Gasum saying its supply would be halted on Saturday.

CEO Mika Wiljanen called the cutoff “highly regrettable”. But he said “provided that there will be no disruptions in the gas transmission network, we will be able to supply all our customers with gas in the coming months”.

Natural gas accounted for just 6% of Finland’s total energy consumption in 2020, Finnish broadcaster YLE said. Almost all is imported from Russia.

That pales in comparison to big customers such as Italy and Germany, who get 40% and 35% of their gas from Russia, respectively.

According to Gasum, Russian state-owned energy giant Gazprom said in April that future payments in the supply contract should be made in roubles instead of euros.