Finland using seized Russian assets to arm Ukraine defence forces

A small European nation has pushed through a move that will simultaneously aid Ukrainians on the front lines and send Vladimir Putin’s oligarchs into a frenzy.

Finland has sent a warning shot to Russian oligarchs as it ramps up its support of Ukraine in the now three-year-long war.

Finland has stood firm supporting the embattled nation since Vladimir Putin’s invasion and has linked arms with several other EU members and Western allies in supplying aid.

The nation joined NATO in 2023 and signed a bilateral defence pact with Ukraine to expand cooperation on intelligence, armaments, and training, providing a whopping $5.79 billion in support.

But now, the funding for arms is coming from a place that hits Putin where it hurts.

The Finnish government has now announced it will send €90 million (A$101 million) worth of ammunition to Ukraine, drawing directly from proceeds generated by Russian financial assets frozen by the European Union.

The Finnish defence ministry confirmed the move on Monday.

Finnish Prime Minister Petteri Orpo. (Photo by Carsten Koall/Getty Images)

The European Union is currently holding an estimated $210 billion of the roughly $300 billion in Russian assets frozen across the bloc. Much of this is tied up in government bonds and reserves once held by Russia’s central bank.

In a shift last year, the European Commission approved using profits earned from these assets to bolster Kyiv’s military through an EU-administered fund.

“We were able to negotiate additional funding for Finland’s support for Ukraine,” said Defence Minister Antti Häkkänen. “The products are purchased from Finnish industry to boost employment at home and sent to Ukraine to help its defence. I am very pleased with the outcome.”

The Kremlin has yet to respond to the announcement, though it has consistently condemned similar gestures as violations of property rights and international law.

The European Union is currently holding an estimated $210 billion of the roughly $300 billion in Russian assets frozen across the bloc. Much of this is tied up in government bonds and reserves once held by Russia’s central bank. (Photo by Maxim Shemetov / POOL / AFP)

Calls for Russian money to rebuild Ukraine

Last year, a group of former politicians, academics, ambassadors and doctors called on the Australian federal government to redirect $9bn of frozen Russian assets to rebuild Ukraine.

Russian oligarchs’ “dirty money” being held in Australia should also pursued, 26 signatories said in the letter.

Signatories included former Prime Minister John Howard, former Russian ambassador Robert Tyson, former Foreign Affairs Minister Marise Payne, various academics, a reverend and former Prime Minister Tony Abbott.

While Australia has no legal mechanism for seizing frozen assets, the signatories say Canada, Belgium and the EU have found artful ways to redirect those frozen assets.

The signatories say in the letter, addressed to Treasurer Jim Chalmers, the Russian central bank has about USD$300bn of frozen assets in the West, including about AUD$9bn in Australia.

Finland’s funding for arms is now coming from a place that hits Putin where it hurts. (Photo by Ihor THACHEV / AFP)

The signatories want the Russian assets diverted to rebuilding Ukraine, a confirmation of how much and what type of assets are being held in Australia, and legislative change “to ensure that Russian assets held here can be utilised to support Ukraine”.

“We make this plea because Australia can punch well above its weight at no cost to the Australian taxpayer,” they said in the letter.

“Nine billion dollars … would effectively fund the reconstruction of half of Ukraine’s educational infrastructure.”

A Department of Foreign Affairs and Trade spokesperson said Australia had sanctioned 1200 people and entities in response to Russia’s invasion of Ukraine, and cut trade with Russia to “negligible” levels.

“Australia’s goal is to empower Ukraine to end the war on its terms. We will continue to provide targeted assistance to Ukraine to impose costs on Russia,” the spokesperson said.

Originally published as Finland using seized Russian assets to arm Ukraine defence forces