Obama Said to Unveil $1 Billion European Fund in Poland

U.S. President Barack Obama
U.S. President Barack Obama. Photographer: T.J. Kirkpatrick/Bloomberg

June 3 (Bloomberg) -- U.S. President Barack Obama plans to announce a $1 billion fund to help boost defensive capabilities of European allies shaken by Russia’s annexation of the Crimean peninsula from Ukraine, according to a U.S. official.

The “European Reassurance Fund” may be unveiled by Obama as soon as today in Poland during his visit there, according to the official, who asked not to be identified discussing the move before the announcement.

The money will be contained in the Obama administration’s fiscal 2015 warfighting request -- known as the Overseas Contingency Operations Fund -- that will be released this month, the official said. That’s the pool of money used to bankroll U.S. military efforts in Iraq and Afghanistan.

Details about what would be supported by the European fund are still being worked out, the official said. Depending on its size and scope, the initiative may be the highest-profile move to date by Obama affirming a commitment to Europe even as he emphasizes the administration’s rebalance to Asia.

A White House spokesman didn’t immediately respond to a request for comment late last night.

Obama’s European trip follows months of tension sparked by the February ouster of Ukraine’s pro-Russian President Viktor Yanukovych. Russia’s move since then to annex Crimea and back pro-Russian separatist movements in eastern Ukraine triggered sanctions against members of President Vladimir Putin’s inner circle by the U.S. and European Union.

Poroshenko Meeting

Starting today in Warsaw, then in Brussels and Paris, Obama will promote economic cooperation, energy security, and solidarity among North Atlantic Treaty Organization and Group of Seven nations. He’s to meet with President Bronislaw Komorowski and Prime Minister Donald Tusk of Poland, a NATO ally.

Obama will use his speeches and meetings with allies to emphasize Putin’s choice between further economic isolation, if Russia continues to seek more control in Ukraine and other former Soviet areas, or an easing of sanctions if he changes course.

While in Poland, Obama will also meet with Ukraine’s Petro Poroshenko, newly elected to become president of the former Soviet state, and to underscore the benefits for Russia if it leaves Ukraine free to pursue its own path.

Amid the tensions over Ukraine, the Pentagon has already deployed F-16 fighters to Poland and a company of the 173rd Airborne Brigade Combat Team to conduct airborne assault exercises with Polish counterparts. Other reassurance measures have included deployment of Navy warships to the Black Sea and F-15 fighters to Lithuania to beef up Baltic air patrols.

Putin and Obama will cross paths in France on June 6 at ceremonies commemorating the 70th anniversary of the D-Day invasion during World War II.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editors responsible for this story: John Walcott at jwalcott9@bloomberg.net Michael Shepard, Mark McQuillan