World leaders are gathering in southern Italy for the G7 summit that begins on Thursday, with the top item on the agenda the contentious question of how to appropriate frozen Russian funds for Ukraine , while minimising the risk of unintended consequences. The European Union agreed last month to send Kyiv the “ windfall profits ” generated from about $300bn (£233bn) in Russian assets held in European financial institutions that Moscow has been denied access to since the invasion of Ukraine . The EU has estimated the total profits from the assets would be between €15bn-€20bn (£12bn-£16bn) by 2027, including around €3bn (£2.

5bn) this year. Advanced talks are ongoing over providing a loan to Ukraine of about $50bn (£38bn), to be paid back in instalments through the profits from frozen Russian assets . But there is said to be disagreement between the US and EU over who would guarantee the loan and how it would be distributed.

“What Washington is proposing is, ‘The US takes a loan, Europe takes all the risk, Europe pays the interest, and the US uses the money for a US-Ukraine fund’,” an unnamed senior European diplomat told Politico . “We might be stupid but we’re not that stupid.” Ahead of the summit, a group of European MPs and officials – including British Foreign Affairs Select Committee Chair, Alicia Kearns , signed an open letter published in the Financial Times calling for all of the Russian funds in Europe to be appropriated.

“The ultimate .