Concessions to Russia for Ukraine Grain Deal Extension

The European Union officials are considering to offer concessions to Russia in return for an extension of the Ukraine grain deal, diplomatic sources said Monday.

They said the idea is to permit the Russian Agricultural Bank to establish a subsidiary to use the international financial communication network, Swift, again for the processing of certain payments.

Sanctions and Agricultural Bank

The bank itself is currently not allowed to do this because of sanctions because of Russia’s war against Ukraine.

The diplomats said the EU is not lifting sanctions against the agricultural bank because there would probably not be the needed consensus among EU-member states to do so.

Importance of Grain Exports

But opponents would probably be unable to block such a move by allowing a new subsidiary to use Swift. Supporters of the measure point out that grain exports are very important not only for Ukraine but also for recipient states in Africa and Asia.

Moreover, in their view, Russia must be prevented from blaming the West for the possible failure of the agreement.

Russia blocked the neighboring country’s grain exports for months after the invasion of Ukraine in February last year. Then, in mid-2022, an agreement was reached between the two warring parties, mediated by the United Nations and Türkiye. After that, Ukrainian grain was shipped again.

Most recently, it was extended for another two months in mid-May — combined with Moscow’s demand that its own exports now also be facilitated.

Russia’s Threat

With the looming expiration of the extension in mid-July, Russia has threatened to let the agreement expire.