Yellen calls on Europe to step up aid to Ukraine

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BRUSSELS – Treasury Secretary Janet L. Yellen on Tuesday urged European nations to increase spending in support of Ukraine as Russia’s attacks on the country’s critical infrastructure showed little sign of abating.

The United States and Europe have coordinated closely in imposing sweeping sanctions on Russia in the nearly three months since its President Vladimir V. Putin ordered an invasion. But they were less united on the need to prop up Ukraine’s economy and help with post-war reconstruction.

Congress has already approved a $13.6 billion emergency spending package for Ukraine and is expected to approve $40 billion in additional aid. While the European Union and international financial institutions have also provided large aid contributions, Ms Yellen said more needs to be done.

“I sincerely ask all our partners to join us in increasing their financial support to Ukraine,” Ms Yellen said in a speech at the Brussels Economic Forum, according to her prepared remarks. “Our joint efforts are critical to ensure Ukraine’s democracy prevails against Putin’s aggression.”

The finance minister is in the middle of a week-long tour of Europe, stopping in Warsaw, Brussels and Bonn, Germany, where she will meet her counterparts at the Group of 7 Finance Ministers summit. Help to Ukraine is expected to be a key issue at this meeting.

Ms Yellen said that Ukraine’s financial needs are immediate and that she lacks the means to pay soldiers, retirees and employees to keep her government running.

“It is clear that the bilateral and multilateral support announced so far, even in the short term, will not be enough to meet Ukraine’s needs,” she said.

It remains to be seen whether their reputation will be heeded. European nations face their own economic strains, including rapid inflation and rising energy costs, and face great challenges in trying to wean themselves off Russian energy.

Ms Yellen said the United States would help break Europe’s dependence on Russian energy, in part by boosting American exports of liquefied natural gas. She acknowledged that some climate targets to reduce emissions could be set back by the need to rely on coal and fossil fuels, but she said the current situation should be a reminder of the need to “consolidate our efforts towards clean and renewable… doubling energies.

In her speech, Ms Yellen said Russia’s decision to halt gas supplies to Poland and Bulgaria should be a lesson that Western nations should not trade national security for cheaper resources. This situation has now left them vulnerable to countries that can use their abundance of natural resources to disrupt markets.

She cited China as a concern for its supply of rare-earth minerals, which are used to make airplanes, cars and high-tech batteries.

“China is building consistent market share in certain technology products and is aiming for dominance in the manufacture and use of semiconductors,” Ms. Yellen said. “And China has engaged in a variety of unfair trade practices to achieve that position.”

Nonetheless, Ms Yellen made it clear that she was not calling for more protectionism or a reversal of globalisation. Instead, when it comes to international trade, nations should not put all their eggs in one basket.

“My point is to suggest that we should consider ways to maintain free trade while reducing some of those risks,” she said.

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