A local woman carries belongings from a damaged house in the town of Borodianka, northwest of Kyiv, on April 6.GENYA SAVILOV/AFP/Getty Images
The federal government is proposing to assist Ukraine’s war-ravaged economy by offering a $1-billion loan through a new Canada-led international financial program.
In the budget tabled on Thursday, the Liberal government outlined its plan to offer the additional loan resources through a new administered account at the International Monetary Fund (IMF) to help the Ukrainian government continue to operate.
Ottawa worked with Ukraine’s government, the IMF and other countries to develop the financial tool, the budget said, and encourages allies and partners to participate. Canada is leading the effort, and is working with the IMF to expand the number of countries involved. The plan is being developed and negotiations are under way, including how the money would be spent.
“It’s clear that the biggest danger in the world is the threat from [Russian President Vladimir] Putin. In Bucha, we saw a regime that is truly criminal,” Finance Minister Chrystia Freeland said.
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Ukrainian organizations and leaders had called on the Liberal government before the budget to impose further sanctions on Russia, provide more financial assistance and, most importantly, to send heavy weaponry to Ukraine.
Ukrainian MP Ivanna Klympush-Tsintsadze said in a recent interview with The Globe and Mail that the Canadian government was working on the financial initiative, which would allow other countries to donate money, and was hopeful more financial assistance would be provided. She was visiting Ottawa with a Ukrainian delegation in an effort to rally more support.
On Thursday, Ukrainian Foreign Minister Dmytro Kuleba tweeted a photo of himself and Foreign Affairs Minister Mélanie Joly at NATO headquarters. “Canada is ready to step up support for Ukraine by providing additional military, financial, and humanitarian assistance. Canada’s support proves the special bond between our two nations,” he said.
The budget says Ottawa is taking every opportunity to isolate Russia at multilateral institutions, and that since the invasion of Crimea in 2014, Canada has sanctioned more than 1,000 people and entities.
Royal Canadian Air Force personnel load non-lethal and lethal aid at CFB Trenton, Ontario, on March 7.The Canadian Press
In March, Canada was among several countries that launched a Russian Elites, Proxies and Oligarchs (REPO) Taskforce to work together on enforcing sanctions against Russian elites and those who act on their behalf. The budget says that includes using resources to “identify, freeze and seize assets.”
In terms of military assistance, Ottawa proposes to provide an additional $500-million in military aid to Ukraine in 2022-23.
The $1-billion loan is in addition to $620-million in loans Canada has offered so far this year in support of Ukraine’s financial stability. The European Bank for Reconstruction and Development said it expects Ukraine’s GDP to fall by 20 per cent this year, and Russia’s to fall by 10 per cent.
Fen Hampson, professor of international affairs at Carleton University, said Ukraine will need a lot more than $1-billion. “Just look at the destruction of Mariupol and other cities,” he said.
“I think if the international community is to get serious, there are ways to lever other resources,” he said, saying seized assets of Russian oligarchs could be used.
He said the budget suggests the government is getting serious about seizing assets, and pointed to Independent Senator Ratna Omidvar’s bill before the Senate, the Frozen Assets Repurposing Act, which would allow courts to donate frozen assets to foreign governments or aid organizations. The budget announced the government’s intent to “clarify the ability of the minister of foreign affairs to cause the forfeiture and disposal of assets held by sanctioned individuals and entities to support Canada’s participation in the REPO taskforce.”
Alexandra Chyczij, national president of the Ukrainian Canadian Congress, said the military and economic aid announced on Thursday is “crucial and timely.”
“Canada understands that the Ukrainian people are courageously defending not only their country, but all of Europe from the criminal Russian regime. The systematic and barbaric evil that is being inflicted on the people of Ukraine leaves no doubt that Russia seeks the annihilation of the Ukrainian people and the destruction of Ukrainian nation,” Ms. Chyczij said.
So far this year, the federal government has committed $145-million in humanitarian assistance and $35-million in development assistance for Ukrainians, which includes $30-million to match Canadians’ individual donations.
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