Yellen calls for ‘massive’ economic assistance to Ukraine
The US is currently preparing a $40bn package for Ukraine, expected to win final passage in the Senate as soon as Wednesday.
US Treasury Secretary Janet Yellen issued a call for large-scale economic assistance to Ukraine, warning that the amounts of help pledged to date won’t even meet short-term needs as the nation struggles with the devastation wrought by Russia’s invasion.
“Eventually, Ukraine will need massive support and private investment for reconstruction and recovery, akin to the task of rebuilding in Europe after 1945,” Yellen said in a speech in Brussels Tuesday. “What’s clear is that the bilateral and multilateral support announced so far will not be sufficient to address Ukraine’s needs, even in the short term.”
The US, which assembled the Marshall Plan to help much of Europe recover after World War II, is currently preparing a $40 billion package for Ukraine, expected to win final passage in the Senate as soon as Wednesday.
“I sincerely ask all our partners to join us in increasing their financial support to Ukraine,” Yellen said. “Our joint efforts are critical to help ensure Ukraine’s democracy prevails over Putin’s aggression,” she said, referring to Russian President Vladimir Putin’s invasion.
Yellen also on Tuesday met with European Commission President Ursula von der Leyen, who later tweeted that the discussion included a European Commission aid proposal for Ukraine that’s expected to be unveiled Wednesday.
Good meeting with @SecYellen
Support to Ukraine in the short & long-term with @EU_Commission’s Reconstruction package tomorrow
🇪🇺🇺🇸 exemplary cooperation on sanctions against Russia. We will keep on coordinating closely
The good agreement on Global Minimum Tax. pic.twitter.com/0Y11Cn18P2
— Ursula von der Leyen (@vonderleyen) May 17, 2022
The US Treasury chief spoke ahead of attending a meeting of finance chiefs from the Group of Seven advanced economies in Bonn, Germany, later in the week. She was delivering an annual lecture at the Brussels Economic Forum named after Tommaso Padoa-Schioppa, an Italian policy maker who championed European integration and helped to conceive the euro.
Yellen highlighted the power of US-European cooperation in preventing Russia from trying to “play off some of us against others.” She also said that if Putin continues the war, Washington will work with European and other partners “to push Russia further towards economic, financial, and strategic isolation.”
The Treasury secretary issued a similar call to European partners to coordinate with the US with regard to addressing Chinese economic policies that have “disadvantaged us all.” She said, “China is more likely to respond favorably if it cannot play one of us off against another.”
Yellen reiterated US support for helping Europe reduce its reliance on Russia as a source of energy, while calling for further efforts to transition toward renewable sources.
“We must heed this wake-up call to expedite the global transition to a more secure and cleaner energy future,” she said. “The longer the current disruption lasts — the more aggressively we say no to Russian oil — the more remunerative it will naturally become to switch to renewables.”
Transatlantic coordination has proved vital as well for the global corporate tax deal achieved last year, Yellen noted. But, “we still have important work to do to get international tax reform across the finish line,” she said. This will require the US and European Union enacting the 15% minimum tax agreed on, she said.
“Open issues” with regard to the other main pillar of that deal — reallocating taxing rights so that multinational companies pay more taxes in the countries where they generate revenue — must be resolved, Yellen said.
(Updates with reference to von der Leyen tweet in fifth paragraph.)