Terry Glavin: From playing war profiteer to playing both sides in the Ukraine war, Trump rattles NATO

As Vladimir Putin’s multiple-front “special military operation” in Ukraine approaches its bloody fourth anniversary and the United States retreats further from traditional American ideals into the backwaters of transactional cynicism, there’s a hard lesson to be drawn from the ongoing dissolution of the transatlantic alliance.

It’s the money that matters.

The multinational effort to keep Ukraine functioning as a sovereign and democratic republic is fast coming down to a mad scramble against deadlines and divisions within NATO and within the European Union about how or whether to keep Ukraine afloat.

Next week’s European Council summit is a make-or-break affair. Council President Antonio Costa says that no matter what happens, Europe will find the money to shore up Ukraine’s solvency for the next two years, but it’s looking increasingly unlikely that any portion of the roughly $300 billion in Europe’s frozen Russian assets will be freed up for a proposed “reparations loan” to fund Ukraine’s reconstruction and defence.

U.S. President Donald Trump opposes any forfeiture of Russian assets and American diplomats have been lobbying Europe’s capitals to keep their hands off the funds, which are held mostly by the securities repository Euroclear in Belgium. The Americans have other ideas about how the money should be handled.

Next month the EU is set to vote on whether to renew its 17 sectoral sanctions against Russian entities. With Hungary, Slovakia and now the Czech Republic straddling allegiances to Vladimir Putin and President Trump, it’s no sure thing that the vote will pass. If the vote fails, Euroclear could be forced to either hand Russia’s frozen assets back to Moscow or sink the money into a joint Washington-Moscow investment portfolio.

Everybody knew that Donald Trump, whose Russian business connections go back decades and whose sympathies with Moscow go back to the Kremlin’s annexation of Crimea in 2014, was going to be a problem. And despite Trump’s persistent claims about what he calls the “Russia hoax,” a bipartisan Senate Intelligence Committee investigation demonstrated conclusively that through a complex web of interference operations in 2016, Moscow “disrupted an American election to help Mr. Trump become president.”

Even so, it still came as a shock to learn last month that behind Europe’s back, billionaire Trump envoy Steve Witkoff and Vladimir Putin’s sovereign-wealth money manager Kurill Dmitriev had cobbled together a secret plan to extricate nearly $200 billion of Euroclear’s frozen Russian Central Bank funds. Last week’s release of the Trump administration’s National Security Strategy came as another shock, forcing the NATO countries to accelerate their reorganization into a post-American democratic alliance. For Canada, the radical shift in the U.S. outlook means that the American “security umbrella” isn’t there anymore.

The Witkoff-Dmitriev plan was specifically intended to head off the European Union’s efforts to reallocate the frozen Russian assets as a lifesaving “reparations loan” to Kyiv. Witkoff and Dmitriev instead envisioned the cash being allocated to Washington-Moscow collaborations in Arctic mining ventures, critical-minerals acquisition and even a hypothetical Russian-American mission to Mars via billionaire Elon Musk’s SpaceX.

This wasn’t a complete surprise. Since Trump was returned to the White House following last December’s presidential elections, the United States has committed no new funds to Ukraine, and American aid officially ended in April. The optimistic view in Europe was that the Trump administration’s grave threat to NATO unity could still be handled by enshrining the White House as a kind of official NATO war profiteer.

That objective has been pursued primarily through a NATO instrument established last summer known as the Prioritised Ukraine Requirements List (PURL). Under the PURL arrangements, the United States sells armaments from U.S. stockpiles to NATO countries that then donate the materiel to Ukraine. Established in July at a meeting between Trump and NATO Secretary General Mark Rutte, the PURL mechanism has so far conveyed more than $4 billion to U.S. defence contractors.

The Netherlands was the first NATO country out of the gate with a pledge to buy Ukraine $577 million in materiel, mostly Patriot missile components. A total of 21 NATO countries have pitched in since then. Canada’s total purchases so far amount to nearly $900 million.

American arms manufacturers Lockheed Martin, General Dynamics and Boeing have done splendidly well, but the PURL instrument still hasn’t been enough to keep the Americans on side.

What the Witkoff-Dmitriev “peace plan” showed wasn’t just that Trump was willing to use American power and influence to force Ukraine to surrender roughly a fifth of its territory to Russia, exclude Ukraine from NATO membership permanently, ban NATO troops from Ukraine and shrink the size of Ukraine’s military. The Witkoff-Dmitriev deal also demonstrated that the Trump administration was willing to use its global power and dominant military status within NATO to profit from both sides in the war, by becoming a Kremlin accomplice in a raid on the $300 million in Russian sovereign wealth funds frozen in western bank vaults.

The attempted shakedown may end up having repercussions far beyond Europe. Quite a few non-NATO countries that would otherwise side with Ukraine should be expected to think twice, to avoid incurring Trump’s erratic wrath. Although he later denied it, Japanese Finance Minister Satsuki Katayama was reported to have been so rattled by the idea of angering Trump that he remarked at a recent G7 meeting that the $30 billion in frozen Russian assets in Japanese accounts would not be put towards the proposed reparations loan to Ukraine.

As for Canada, already shuddering from Trump’s tariffs, and with the Canada-U.S. Mexico Agreement up for review next year, it is not at all clear whether Prime Minister Mark Carney will maintain Canada’s formerly high profile role in mobilizing allies for Ukraine’s defence established by Chrystia Freeland while she was foreign affairs minister. Freeland is still technically Ottawa’s liaison with Ukraine, but she is no longer in cabinet, has no office, staff or travel budget.

Freeland was a key NATO figure in establishing the Extraordinary Revenue Acceleration Loan Mechanism, an instrument that allows NATO states to allocate the interest accruing from Russia’s seized assets directly to Ukraine. Canada alone managed to convey $5 billion to Ukraine through the mechanism.

Roughly $22 billion in Euroclear’s Russian accounts are held by Canadian banks, and Canada has already signalled a willingness to support a EC reparations loan. But those moneys are at increasing risk from an American intervention along the lines of the Witkoff-Dmitriev “peace plan” and from the possibility that the upcoming EU votes on continuing Russian sanctions will get vetoed by Europe’s pro-Kremlin bloc in Hungary, Slovakia or the Czech Republic. The Euroclear-held funds in Canadian bank accounts are directly protected only by the EU sanctions.

The Macdonald-Laurier Institute’s Marcus Kolga, who led the international campaign to establish “Magnitsky sanctions” against Russian kleptocrats and other police-state criminals, says Canada needs to act fast. An amendment to the budget authorization bill empowered Ottawa to require Canadian banks to disclose exactly which accounts contain Euroclear’s Russian assets. But Ottawa would have to make its move very quickly.

“The first thing we need to do is get a hold of the money. That’s the focus. Once we have the money we can figure out what to do with it,” Kolga told me. “Everyone is on board, the Liberals included. If we don’t act and Europe’s Russia sanctions get vetoed, those funds could go straight back to Moscow.”

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