The Mega-yacht Scheherazade, linked to Putin. Credit: Wikimedia Commons

Why Confiscated Russian Assets Must Pay For Ukraine’s Reconstruction

Western countries have seized hundreds of billions of dollars of Russian assets following Russia’s full-scale invasion of Ukraine two years ago. Since then, the question of what to do with those assets has loomed large over debates about Ukraine.

My interview guest Vladimir Milov is a former Deputy Minister of Energy of the Russian Federation and now a Russian opposition politician. He was an associate of the late Alexei Navalny. When we spoke last week he made a compelling case for the expropriation of Russian assets as a means to aid Ukraine’s reconstruction efforts. Milov explains how a web of state-affiliated oligarchs help shield Russian assets from seizure and what must be done to track down those assets. He discusses some of the political and economic risks of confiscating Russian assets for Ukraine’s reconconstruciton, but forcefully argues that the benefits far outweigh these risks.

This interview helps to substantially advance an ongoing debeate in international policy circles about whether or not to repurpose seized Russian assets for the benefit of Ukraine.

The full podcast interview is freely available across all podcast platforms. You can find it on Spotify here. On Apple Podcasts here. The interview was inspired by Milov’s article for the Globesec think tank “Confiscating Russian Assets: Difficult But Necessary

Key Takeaways:

  • Frozen Russian assets in Western countries could potentially be deployed to fund Ukraine’s reconstruction post-conflict. There’s been a hesitancy thus far to do so, but the mood is changing.
  • Beyond the $300 billion estimate, far more Russian money controlled by state-linked corporations and oligarchs could be discovered and utilized for rebuilding efforts.
  • Political will is key in realizing the repurposing of these assets. The forthcoming G7 meeting in Puglia, Italy in June could be a turning point in the decision-making process. 

Key Quotes:

“The primary issue here is the destroyed Ukrainian property. Russia illegally attacked Ukraine and essentially destroyed a lot of assets in the Ukrainian economy worth hundreds of billions of dollars. We can go into precise estimates, but we’re talking about hundreds of billions. So somebody has to pay for it.” – Vladimir Milov

“If you look at the structure of the Russian economy, it is vastly dominated by state-controlled players. So who were the owners of most of this one and a half trillion dollars that were moved outside the country? You can easily guess that a large part of this is controlled by corporations directly linked to the Russian state.” – Vladimir Milov

“We all remember the post Versailles situation when Germany was overburdened with reparations after World War I, and that contributed to the rise of the revanchist sentiment in the Nazi party. We all need to remember that experience. And don’t forget, Russia was was brutally and viciously robbed by Putin’s cronies. So there are ways to find this money to finance the reconstruction of Ukraine without actually getting into the pockets of Russians.” –Vladimir Milov