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Ukraine was the main topic in two international meetings last week. The G7 nations — the United States, the United Kingdom, France, Germany, Japan, Italy and Canada — summit and Ukraine peace summit in Switzerland where the representatives of 92 countries attended. The question is: are these coming togethers beating the bush or are they steps forward for Ukraine’s territorial integrity and sovereignty?

During the first summit two developments had taken place. One is at the sideline between US and Ukraine signing a 10-years bilateral security agreement and the other is the decision of the G7 nations in providing a $50 billion loan at the expense of the profits of the frozen Russian assets.

The bilateral security agreement is a rather flimsy attempt to Trump proof the US aid. Since it won’t be ratified by the parliament to become a treaty, any future President could withdraw from it. If Biden or another democratic party candidate was elected, the agreement may evolve to a more comprehensive and binding peace treaty, but at the moment, it is more a propaganda of President Biden to represent himself as the leader who unites the West against Russian aggression.

The G7 summit itself on the other hand came up with an innovative solution to finance the Ukraine economy with an additional financial support of approximately $50bn in loans by the end of the year 2024. For a long time the West tried to conceive a way to utilise Russian frozen assets in financing Ukraine. Since the €190bn of the $300bn of frozen Russian assets is in the EU zone and the US has just $5bn of the assets, it is easier to say by the US than done by the EU.

The legality of the seizure of the assets is a major issue. A legally unjustified seizure would reduce the trustworthiness of the EU market resulting third countries to withdraw their money destabilising the Euro. The frozen assets generate about €3bn a year in profit and since there are no contractual obligations it is speculated that the profits have no legal owner. Based on this claim $50bn loan will be obtained by a yet to be determined member of the G7 and will be paid back by the profits of the frozen assets.

If the US-Ukraine security agreement is flimsy, the loan is prone to be a liability. At least 10 years of interest payments will be necessary to pay off this loan and that is a long time to to keep the assets frozen. If the EU could not extend the sanctions because of the veto of a member nation - for example Hungary, the assets have to be unfrozen. Alternatively after the war it could be difficult to unfreeze the assets because its interest revenue would be bound to pay the loan.

The final meeting, the peace summit, aimed to shape a path towards peace between Ukraine and Russia. On the positive side, 80 of the 90 participant countries agreed on the statement that Ukraine’s “territorial integrity” should be respected in any peace deal to end the war, which is a step forward for a lasting peace in the region. However China, the most important supporter of Russia, flatly refused to participate in the summit and several key nations like Saudi Arabia, India, South Africa, and the United Arab Emirates, despite having attended the summit, did not sign the final communique.

Moreover, Russia described the event futile and President Putin repeated the same demands at the beginning of the conflict for a peace. India and Saudi Arabia declared that the absence of Russia was the reason for not signing the agreement. For South Africa the reason was the participation of Israel which makes the communique’s legitimacy questionable as Israel is accused of committing war crimes against Palestinians.

If you are after flary and conclusive moves, none of these events are remotely satisfying. However, the war with Russia is like playing with a renowned old chessmaster who plays absolute tactics with great mastery and his fame gives the spectators a certain awe that prevents them from evaluating his moves negatively. Ukraine has no luxury for a draw let alone to lose a single game. However dull their play is they should play securely and add small gains that will bring the checkmate or resignation.

It is true that the G7 summit brought into life a security agreement that is doubtful to survive even for 10 months and a questionable meagre $50bn loan. Nonetheless, G7 countries crossed a red line to use frozen assets to support Ukraine. Today it is a $50bn loan, tomorrow it may be $300bn to rebuild Ukraine.

It is also true that, for today the peace summit may have no ground to enforce a peace treaty in favour of Ukraine, yet the countries which did not sign the communique have participated in the summit unlike China.

Their excuse not to sign weakened with the outrageous demands of President Putin disregarding the realities on the battlefield. Even in the absence of ammunition and military equipment, the Ukrainian army succeeds in stopping the Russian offensive. Also President Putin is continuously on the move between different countries to secure logistic supply which proves that the so-called Russian economic growth is just a hype.

Nobody would like to be on the losing side, even China did not sign for a Russian aggression that will last longer than two weeks. Only necessities hold them together. The small steps that Ukraine makes both in the battlefield and in diplomacy may not be impressive individually but when added together cripples its enemy.  

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