Illicit Finance: War in Ukraine

Debate between Liam Byrne and Anne-Marie Trevelyan

Thursday 13th July 2023 Commons Chamber

[Anne-Marie Trevelyan]

If my right hon. Friend will give me a moment, I shall attempt to answer that question in due course.

[Liam Byrne]

I am grateful to the Minister for giving way; she is being characteristically generous. Could she tell the House whether that bearing down on economic criminals will include Government acceptance of the excellent amendments tabled by Lord Agnew in the other place, which have widespread support in this House?

[Anne-Marie Trevelyan]

The right hon. Member will know that I am unable to answer that at this point—it is a question for the Leader of the House—but I have no doubt that it has been heard and that the cross-party support for that measure has been duly noted.

We are working closely with our international partners to address the impact of Russia’s war on global food prices and food security for the world’s poorest. That includes working to keep exports of Ukrainian grain flowing through the UN Black sea grain initiative, which has helped more than 32 million tonnes of grain and other foodstuffs to reach countries around the world.

To respond to the point that my right hon. Friend the Member for Esher and Walton (Dominic Raab) made about Turkey’s commitment—that country’s assistance in keeping that grain initiative flowing despite the continued challenges—we should all commend its efforts, quietly and behind the scenes, to make sure that those flows of food can continue. Its commitment has been exemplary.

Russia continues to delay and obstruct inspections of ships, but food cannot be a weapon. It is reprehensible that Russia is threatening not to extend the deal, which would increase food prices for the world’s poorest, so the UK is supporting Turkey and the UN in their very focused efforts to ensure that the initiative can continue unimpeded, and to renew the grain deal beyond 17 July. Just yesterday, the UN Secretary-General sent a further proposal to Russia to address concerns over the export of Russian food and fertiliser. The UN offer on the table will give stability to both the Black sea grain initiative and Russian agricultural exports, helping to provide easier access to food across the world.

[Anne-Marie Trevelyan]

I thank my right hon. Friend for his intervention. Turkey, in particular, is making incredible efforts and has continuing negotiations and conversations as a close neighbour and the guardian of the Dardanelles—that critical piece of water through which all these ships have to pass. It is clearly managing that situation, and we continue to support Turkey’s efforts to find ongoing solutions. My right hon. Friend the Foreign Secretary will be chairing a session of the UN Security Council next week to discuss exactly these issues—the impacts of the war, both in Ukraine and across the world.

Turning to an issue that colleagues are rightly focused on, we are of course looking to the future while dealing with the present-day challenges of supporting the Ukrainians as they prosecute the war. We are supporting the office of Ukraine’s prosecutor general to help it investigate and prosecute alleged war crimes. The UK provided £2.5 million of funding to support Ukraine’s domestic investigations and prosecutions in 2022, and we intend to provide similar levels of funding this year. We welcome the steps taken by the independent International Criminal Court to hold those at the top of the Russian regime to account, including Vladimir Putin. We have provided an additional £2 million to the ICC for evidence collection and support for victims and witnesses, and in May, along with 40 other states, we signed an agreement to create a new international register of damage caused by Russian aggression against Ukraine. That is an important step in the pursuit of justice for the Ukrainian people.

Just a few weeks ago, in June, we co-hosted with our Ukrainian friends the 2023 Ukraine recovery conference here in London. That conference raised over $60 billion, including a new €50 billion EU facility and $3 billion in UK guarantees to World Bank lending. Almost 500 companies from 42 countries, worth more than $5.2 trillion, pledged to back Ukraine’s reconstruction through the Ukraine business compact. The conference also agreed to forge a new G7+ clean energy partnership to help Ukraine rebuild a net zero energy system connected to Europe.

Members rightly want to see continued sanctions, asset freezes and travel bans during this very difficult time. Just last week, I was proud to bring in new legislation that will enable sanctions to be maintained until Moscow pays compensation for the reconstruction of Ukraine and a route is developed for Ukrainian reconstruction. We will, of course, also be creating a route to allow individuals to voluntarily hand over those assets of theirs that are presently frozen into a fund to support reconstruction. That will be a one-way ticket: if those people feel that they have realised the error of their ways, it will be an opportunity for them to support Ukraine’s reconstruction.

[Liam Byrne]

I am grateful to the Minister, because I do not think the House had had a chance to cross-examine her on that point. Is she saying that sanctions will remain in place until Russia has stumped up the full bill for reconstruction, and if so, what are the expectations of the amount that Russia will need to pay in order to get those sanctions lifted?

[Anne-Marie Trevelyan]

The right hon. Member asks an important question. Sadly, that figure grows day by day—I think the latest assessments are that something like $400 billion is expected for the reconstruction, but as the war goes on, that figure is likely to grow as more infrastructure is damaged. Greater reparations would be required to help Ukraine get back on her feet completely, but the new legislation will enable existing sanctions to stay in place until agreements on that compensation payment are reached. Discussions about what that might look like will continue in due course.

Russian Assets: Seizure

Debate between Liam Byrne and Anne-Marie Trevelyan

Tuesday 14th March 2023 Commons Chamber

[The Minister of State, Foreign, Commonwealth and Development Office (Anne-Marie Trevelyan)]

I thank my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for securing this important debate. I am grateful to him and other hon. Members for the points they have raised, which I will do my best to address this evening. As ever, I will make sure that we write to Members if I am not able to pick up any specific points.

As we move into the second year of Putin’s illegal and brutal war, I am grateful for the ongoing unity shown by hon. Members on both sides of the House and for the shared determination to support President Zelensky and all Ukrainians until they prevail. It is an honour to have some of our Ukrainian friends in the Gallery today.

Before addressing the seizure of Russian assets, I underline the magnitude of the UK’s response to Putin’s invasion. Although I hear the challenge of the hon. Member for Rhondda (Sir Chris Bryant) on the quantum of sanctions to date, I will set out what we have done so far. The UK alone has sanctioned more than 1,500 individuals and entities with a net worth of $145 billion, and we have frozen more than £18 billion-worth of Russian assets—assets that Putin now cannot use to fund his war machine. We have also introduced an unprecedented number of trade measures, which have led to a 99% reduction in imports of goods from Russia and a 77% reduction in exports of UK goods to Russia. All those measures have been determined to restrict Putin’s ability to fund and sustain his illegal war. The measures represent the most severe sanctions ever imposed on Russia. The package of sanctions to date includes asset freezes on 23 major Russian banks, with global assets worth $960 billion—that is 80% of Russia’s banking sector—the prohibition of Sberbank from clearing and the removal of 10 banks from SWIFT.

I remind the House that we have sanctioned the Wagner Group in its entirety, and its leader, Prigozhin. My right hon. Friend the Member for Chelmsford (Vicky Ford) will know that, although I cannot comment on whether an organisation is or is not under consideration for proscription, her comments have been noted.

[Liam Byrne]

The Financial Times has revealed that the Wagner Group has channelled $250 million into its organisation through sanctions evasion. Is that not evidence that the sanctions implemented against the Wagner Group are not working? What information can the Minister supply to persuade the House that the enforcement regime is actually effective?

[Anne-Marie Trevelyan]

I will come back to that in a moment.

The right hon. Gentleman also set out, with his usual articulateness, a very clear pathway through which the UN and the international community might work together to seize Russian state assets. I hope I can reassure him that we will continue to work at the UN with all like-minded countries to address the asset seizure challenge.

The latest package of internationally co-ordinated sanctions and trade sanctions was introduced to mark the anniversary of the invasion on 24 February, and it includes export bans on every known item Russia has used on the battlefield. This combined package of sanctions has been carefully constructed with our allies to cripple Putin’s supply chains, to limit his ability to finance his war and to target those who are propping up his regime. It serves as a stark reminder to Russia and any other would-be hostile actors of the cost of flagrantly assaulting the democracy, sovereignty and territorial integrity of another nation.

As Members have highlighted in the debate, the reconstruction of Ukraine is absolutely at the top of the international agenda, while we continue to support Ukraine to defend its country. In September, the World Bank estimated a cost of $349 billion to rebuild Ukraine—a figure that has been rising every day since. Indeed, colleagues have highlighted recent assessments with figures of about $750 billion. Those are monumental sums to consider in respect of the reparations that will be needed.

The UK Government will continue to take a leading role in determining how to assist in this long-term reconstruction challenge. In June, we will be co-hosting the 2023 Ukraine recovery conference in London, alongside the Ukrainian Government. Together, we will mobilise public and private funds to ensure that Ukraine gets the reconstruction investment it needs.

We also remain committed to continuing our direct support for Ukraine. To date, we have helped more than 13 million Ukrainians affected by the war, providing them with £220 million of vital humanitarian assistance, delivered through the United Nations, the Red Cross and other non-governmental organisations. We will continue to work alongside our Ukrainian friends in support of their military defence for as long as they need us to do so.

The key issue of seizing Russian assets to fund Ukrainian reconstruction is one that the Government are extremely focused on, and we are in close discussions with friends and allies. The Government remain clear that Russia must be made to pay for the harm it has caused in its illegal war in Ukraine, in line with international law. The Prime Minister made that clear in the London declaration he signed with President Zelensky during his recent visit to the UK and in the G7 leaders’ statement on 24 February. We have been 100% clear: Putin must pay. We are working in the FCDO, in consultation with other Whitehall Departments and our G7 partners, to review all lawful options to make frozen Russian assets available for rebuilding Ukraine.