“Our sanctions will undo fifteen years of economic progress in Russia” (Joe Biden)

Joe Biden’s words speak eloquently of the United States’ determination to impose tough sanctions on Russia: “Our sanctions will certainly undo fifteen years of economic progress in Russia” and “we will stifle (its) ability to grow for years,” he told a trade representative. . a trade union conference at which the US President condemned “major war crimes” and called on the international community to “come together to bring those responsible to justice”.

According to Washington, this year the Russian economy may indeed collapse by about 15%. “The reality is that the country is sinking into economic, financial and technological isolation,” he said. a senior administration official told reporters. “And at this rate, it will return to the standard of living of the Soviet period of the 1980s.”

“I have made it clear that Russia will immediately pay a heavy price for its atrocities in Bucha,” Joe Biden added on Twitter as the United States announced a new round of economic and financial sanctions against Russia on Wednesday. Described in a press release as “devastating,” they primarily target big banks and Vladimir Putin’s daughters.

War will cause -20% recession in Ukraine, -10% in Russia this year, according to EBRD

New portion of sanctions

In addition to banning all new investment in Russia, the measure announced with further isolate Moscow from the world economy, The US executive branch will impose the most severe restrictions on the main state bank Sberbank with almost a third of the country’s global banking assets, and the country’s largest private bank, Alfa Bank. Those institutions, already subject to less stringent sanctions, will be subject to a freeze on all their assets “in contact with the US financial system” and will be prohibited from making any transactions with US entities, the White House said. To increase pressure on Vladimir Putin, Washington is also attacking “key Russian state-owned enterprises” to undermine the Kremlin’s ability to fund its military operations. The Treasury Department will reveal the names of affected organizations on Thursday, the White House said.

Sanctions against Putin’s daughters

The United States is also targeting the circle of Russian President Vladimir Putin by imposing sanctions against them daughter of the latter. “We believe that many of Putin’s assets are hidden through members of his family, and that is why we are targeting them,” said the senior US official quoted above.

The wife and daughter of Russian Foreign Minister Sergei Lavrov are also targeted, as are members of the Russian Security Council, including former President and Prime Minister Dmitry Medvedev.

“The families of these oligarchs will not be allowed to keep their wealth in the US or Europe, they will not be able to keep their multi-hundred million dollar yachts or their luxurious country houses while children are being killed in Ukraine or forced to leave their homes every day,” Joe Biden assured.

Simultaneously with the fall of new sanctions, the US announced an indictment against billionaire Konstantin Malofeev. The oligarch, who is considered one of the main sources of funding for pro-Russian separatists in eastern Ukraine, has been accused of “trying to evade sanctions by using accomplices to covertly acquire and control media in Europe.”

Earlier this week, the United States also decided to ban Russia from repaying its debt in dollars, which increased the risk of a default. However, on Wednesday, Russia’s Finance Ministry said it had repaid its dollar-denominated ruble debt after a foreign bank refused to make a dollar payment, putting it at risk of default.

Released energy

On the other hand, transactions in the energy sector exempted from sanctions, with the exception of the Russian oil embargo. Today, this does not interfere with imports.

Despite the embargo, the US continues to import Russian oil!

“Unfortunately, many of our European partners are still heavily dependent on Russian natural gas as well as oil, and they are keen to get rid of this dependence as quickly as possible. We are doing our best to help, but in the meantime we have introduced this exception (…) We have worked closely with them on the sanctions and want to stay by their side,” US Treasury Secretary Janet Yellen explained on Wednesday under questioning by the House Financial Services Committee of Representatives.

Discussion of the European embargo on Russian coal

European Union diplomats on Wednesday failed to agree on a fifth set of sanctions against Russia, proposed the day before by the European Commission, due to technical issues that remain to be resolved, including the impact on contracts of a possible coal embargo, three sources said. from the talks, Reuters reported.

Despite the uncertainty associated with resolving these technical difficulties, European diplomats were optimistic that a compromise agreement could be reached at a new meeting of the Committee of Permanent Representatives of Member States to the EU (Coreper) scheduled for Thursday. According to these sources, Germany, the leading importer of Russian hydrocarbons, has posed the main problem, so far reluctant to accept the embargo principle because of its energy dependence on Russia. Therefore, the representative of Germany asked for details on the consequences of a possible embargo on coal, wishing to know whether it would affect contracts already signed or only those that would be awarded in the future. If the embargo only applies to new contracts, Russia could still export coal to the EU for a long time to come. Meanwhile, European officials told Reuters that the European Commission has proposed a 90-day phase-out period for ongoing contracts. Other technical issues that need to be addressed relate to measures to be taken to prevent access to European ports for ships flying the Russian flag or operated by Russia, and to effectively enforce the ban on Russian companies from accessing public markets. in member states, one of the sources said. According to the sources, the Commission was urged to clarify some of the proposed measures and to strengthen the legal soundness of other provisions before their eventual approval on Thursday.

But the coal embargo is not enough to break Moscow.

Ukraine: Why a European embargo on Russian coal won’t be enough to make Putin bend

Germany does not want to touch gas, Italy is ready to accept it

The real topic concerns Russian gas. European Council President Charles Michel may say that the EU “sooner or later” will have to impose sanctions on Russian oil and gas, a possible embargo on oil (25% of European purchases) and gas (45% of EU imports). ) is the subject of heated debate among Member States, and Berlin has publicly expressed its dislike.

From the very beginning of the conflict, Berlin did not stop repeating it. If Germany is looking for alternatives, then Russian gas supplies are indispensable “in the short term”, and sanctions against Moscow in this sector will harm the EU more than Russia, German Finance Minister Christian Lindner estimated on Monday. On the other hand, the Baltic countries have stopped importing Russian gas since the beginning of April. However, highly dependent on gas and Russian gas in particular, Italy “will follow the decisions of the European Union” and, in particular, a possible gas embargo, which, however, “is not yet discussed,” Prime Minister Mario Draghi said on Wednesday. Italy is very dependent on Russian gas as it imports 95% of the gas it consumes, of which about 40% comes from Russia.

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London further tightens sanctions

The UK tightened its sanctions on Wednesday, banning all British investment in Russia and targeting the banking and energy sectors, as well as the oligarchs. The new measures, referred to in the Foreign Ministry’s statement, include a “complete freeze of assets” of Russia’s first bank, Sberbank, and a halt to imports of Russian coal before the end of the year.

The British government has already signaled that it wants to stop buying Russian oil this year. He clarifies that he intends “after that, to stop gas imports as soon as possible.” It also targets “strategic industries and state-owned companies” by banning imports of iron and steel. London has specifically targeted eight businessmen whose assets in the United Kingdom have been frozen and denied entry to British soil.

Among them are billionaire Leonid Mikhelson, head of gas conglomerate Novatek, as well as heads of truck manufacturer Kamaz Sergey Kogogin, Gazprombank Andrey Akimov, oil company Gazpromneft Alexander Dyukov and diamond giant Alrosa Sergey Ivanov. Boris Rotenberg, the son of a billionaire close to Vladimir Putin, who bears the same name, is also concerned. According to London, 82 oligarchs with a net worth of £170 billion (€200 billion) and 18 banks with assets of £940 billion (€1.120 billion) are now sanctioned through these measures. On Tuesday, the UK froze $350 billion in foreign currency from the Russian regime, President Vladimir Putin’s “war chest”.

(with agencies)