A lifeline for Ukraine that costs Canadian taxpayers nothing: Balkan Devlen, Aaron Gasch Burnett, and Yuliya Ziskina in National Newswatch

This article originally appeared in National Newswatch.

By Balkan Devlen, Aaron Gasch Burnett, and Yuliya Ziskina, March 3, 2025

Canada’s support for Ukraine has long been a matter of words rather than action. For the past year and a half, the Liberal government has stalled on vital legislation that would let us confiscate frozen Russian state assets—over CAD 20 billion held in Canadian dollars.  Through this delay, the government has undermined the credibility of seizing assets as a viable solution, but has also jeopardized Ukraine’s future. What’s more, the Prime Minister’s politically selfish prorogation of Parliament has left Canada unable to act to either loan the $5 billion it promised Ukraine, to be repaid with the future interest on the frozen assets, or to transfer the assets themselves to Ukraine. Both measures require Parliament to pass authorizing legislation.

This delay and inaction are particularly galling when the measure would cost Canadian taxpayers absolutely nothing. With Parliament prorogued until March 24th and the government likely to fall when the House reconvenes, Canada is left to support Ukraine through an existential crisis without the full financial force only Parliament can deliver.

Even so, given this legislative deadlock and uncertain political future, Canada can – and must – adopt four practical measures:

First, extend a loan to Ukraine backed by the Russian state assets held in Canadian dollars up to the threshold allowed without parliamentary approval. This won’t come close to providing the billions Parliament can authorize. But they still represent a ready-made financial resource that can be deployed now to empower Ukraine – at no net cost to the Canadian taxpayer. The assets would serve as collateral for this loan.

The loan, backed by Russian state assets as an alternative to seizing and transferring them outright, is an immediate interim measure given that Canada has yet to operationalize its asset seizure legislation passed in June 2022. It must be accompanied with credible, binding assurance that seized state assets will be used to repay this loan.

Second, as soon as Parliament reconvenes—whether after the prorogation on March 24 or following the next election—the current or incoming government must fast-track legislation to formalize transferring these assets to Ukraine. Retired Senator Ratna Omidvar and Senator Donna Dasko already drafted a legislative amendment allowing this, to which both senior Liberals and Conservatives have signalled support. In the interest of international security, we need our MPs to come together to pass it.

Third, Canada can signal its intent to seize by moving the frozen assets held in Canadian banks to separate accounts. The Finance Ministry’s response to an order paper question submitted by Calgary-Heritage MP Shuvaloy Majumdar suggests the government may know which Canadian accounts hold these assets – but they may be co-mingled with non-sanctioned entities. The ministry can move these assets now (making them easier to seize later).

Finally, the government should encourage its allies to follow the Canadian example of listing the Central Bank of Russia on its sanctioned entities list. Although other allied countries have listed the CBR’s Governor Elvira Nabiullina individually, not everyone lists the CBR itself – as Canada does. The government can encourage allies to follow suit – and tighten the pressure on Russia.

To repeat; this costs Canadian taxpayers nothing. Loaning against these assets and preparing to seize them provides Ukraine with means to immediately defend itself, and reinforces a fundamental principle: aggressors must pay for their actions. It also sends the message that Canada intends to stand up to Trumpian strong-arming of Ukraine.

Inaction leaves Ukraine vulnerable — to both Russian military advances and to pressure from the United States, which appears ready to let Ukraine bear the brunt of a costly peace deal. Providing Ukraine with a robust financial buffer can help shift the balance of power, ensuring Ukraine remains the master of its own destiny.

Critics worry that seizing foreign assets might spark economic instability or a backlash in international finance. However, these concerns are overstated. Markets have already adjusted to the freezing of RCB assets. Rather than destabilize the financial system, this move would strengthen it by upholding the rule of law and ensuring that economic resources are not used to fuel further injustice.

Legally, seizing these assets is well within the scope of recognized countermeasures against acts of aggression. It is a measured and justified response to a clear and present danger—a tool to ensure that those who violate international law are held accountable for their actions.

The moral case is also clear. Russia must be held accountable for the destruction and human suffering it has inflicted upon Ukraine.

The Canadian government must stop dithering and start acting. Our support for Ukraine must be as strong in practice as it is in principle. By issuing an immediate loan backed by Russian assets, Canada can provide Ukraine with critical resources it needs now, and signal its commitment to fast-track legislation to seize these assets as soon as possible.

The government’s inaction over the past year and a half has already cost valuable time.

Now is the moment for bold, decisive action. Only then can we truly claim to stand by Ukraine.

Balkan Devlen is the Director of the Transatlantic Program and Senior Fellow at the Macdonald Laurier Institute.

Aaron Gasch Burnett is Senior Fellow at the Democratic Strategy Initiative, based in Berlin.

Yuliya Ziskina is Senior Legal Fellow at Washington-based Razom for Ukraine.

All three authors have consulted with Canadian politicians on amending the Special Economic Measures Act.