The idea that Norway will act as guarantor for a giant loan from the EU to Ukraine of 140 billion euros has gained momentum.
Finance Minister Jens Stoltenberg will not rule out anything before the proposal is submitted, but he rejects one thing:
“There have been suggestions that Norway should guarantee the entire amount. That is not an option. But whether we can contribute, we will now have to look at that depending on what the EU proposes,” Stoltenberg told NRK.
He was in Brussels on Wednesday to have meetings with both the EU Commission and the EU countries’ finance ministers.
“We will provide significant support to Ukraine, but whether we will provide it directly as financial gifts from Norway or via a loan scheme in the EU is not something we can decide on until we know what the EU actually proposes,” he told NRK.
Pressure During Question Time
Last week, the Liberal Party (Venstre) leader Guri Melby sent a written question to Prime Minister Jonas Gahr Støre whether the government will take the initiative for Norway to act as a guarantor for a giant loan to Ukraine.
She refers to the EU’s plan to give Ukraine a loan of 140 billion euros, just over 1,600 billion kroner, with security in Russian billions that are frozen in the Euroclear securities fund in Belgium.
During the Storting’s question time on Wednesday, Støre was pressed about the matter, whether it is appropriate to use the oil fund as a guarantee for the Ukraine loan.
“I have seen speculation that Norway would provide our oil fund as a guarantor for such a type of loan. That is not appropriate,” says Støre to TV 2.
From the Storting’s rostrum, he emphasised that the EU has not yet made any decisions.
“The EU must think this through together before we consider it. Nansen is our main road,” he stated, referring to the Nansen package to Ukraine of at least 15 billion kroner a year until 2030.
Frozen Funds
Several EU countries want to give Ukraine a so-called repair loan—a kind of interest-free advance on a theoretical compensation from Russia when the conflict is over.
Russian assets worth 140 billion euros are now controlled in Euroclear’s enormous brick and glass bank building in Brussels. The EU will send a corresponding amount as a loan to Ukraine.
The loan is a hot topic in the EU, but Belgium is holding back.
They are worried about reactions from Russia and that they will receive a claim for compensation against them. Prime Minister Bart De Wever is demanding that the EU, which consists of several already indebted countries, share the risk.
This is where the idea of Norway as a guarantor comes in.
It was first put forward by two Norwegian economists, and has then been heard outside Europe. Among others, by Willy Søvndal, the former Danish Foreign Minister who now sits in the European Parliament.
“This is not just an EU problem, but a common European problem. It is not just about the EU, but the whole of Europe and thus Norway contributing,” he told NRK.
Risky Venture
Centre Party leader Trygve Slagsvold Vedum pointed out that using the Petroleum Fund as a guarantee entails great risk.
In addition, such a loan guarantee would be contrary to the framework for the Petroleum Fund, believes the former Minister of Finance.
“We must not do this, and there is no reason for us to do so,” Vedum told NTB on Tuesday.
Progress Party leader Sylvi Listhaug also believes the risk is sky-high.
“We categorically say no to us stepping in as a guarantee for an EU loan with the Oil Fund. We believe that it is not Norway’s task to do that,” she told TV 2.
Norway Has To Share Its Extra Money With Ukraine
Finnish MEP, retired general Pekka Toveri, also says that Norway has the ability to provide guarantees.
Norway has earned over a thousand billion kroner in additional income from gas after Russia went to conflict with Ukraine.
“They make good money from the war conflict. That is an argument for Norway to contribute.”
So far, Belgium has put its foot down for fear of Russian reprisals. This may require guarantees that relieve Belgium and Euroclear. And here Norway can play a role, believe Melby and several economists and experts.
Ukraine is in danger of running out of money by spring, not least because support from the United States has dried up. At the same time, many EU countries are struggling with their own economies.
Source:
- Forsvarets forum (in Norwegian)
- NRK (in Norwegian)
- Panorama Nyheter (in Norwegian)