US steps up Russia sanctions

Obama leads the way with tougher sanctions on Russia, but will the EU follow suit?


Russia’s meddling in what was the Ukrainian state of Crimea already led to some rather tepid preliminary sanctions. However, because of Russian President Putin’s refusal to back down over his efforts to bring Crimea back within Russian territory, the US has decided to step up sanctions against some of his key advisors.

In the initial aftermath of the hastily arranged referendum on Crimean independence, both the US and EU announced a range of travel bans and asset freezes on 11 and 21 key individuals respectively. Met with little more than amusement from many of the targeted individuals, Russia has continued to push ahead with plans to reintegrate Crimea through a series of parliamentary votes.

Now President Obama has decided to toughen his country’s stance on the issue by taking aim at Putin’s inner circle of trusted advisors, many of who play important roles in Russia’s key industries. Obama last night announced that alongside the initial 11 individuals, sanctions would now include an additional 20 people, including presidential chief of staff Sergei Ivanov, Russian Railways chief Vladimir Yakunin, and Gennady Timchenko, the head of key Russian bank Gunvor. In response to the news, Timchenko quickly sold his 43 percent stake in Gunvor, the world’s fourth largest oil trader, to allow it to continue to operate “uninterrupted”.

Announcing the moves, Obama hopes that the moves will put increased pressure on Russia’s economy and force it to take a step back from its antagonistic actions. “We’re imposing sanctions on more senior officials of the Russian government. In addition, we are today sanctioning a number of other individuals with substantial resources and influence who provide material support to the Russian leadership, as well as a bank that provides material support to these individuals.”

While the moves appear tough, much of the response over the last week from Russia’s top brass has been indifferent. In reality, Russia does little business with the US, and so the sanctions seem largely symbolic. Yesterday the country even put its own travel bans on US officials that are similarly meaningless.

While the moves appear tough, much of the response over the last week from Russia’s top brass has
been indifferent

Obama has led the way in being tough on Russia, hoping to see his EU partners follow suit. While European leaders have imposed their own set of sanctions on some in the Russian leadership, they have been somewhat more reticent because of the level of trade that goes on between the two regions.

With Germany largely reliant on Russian oil and gas – around 40 percent of its energy comes from Russian pipelines – Chancellor Angela Merkel has found it difficult to take as tough a stance as Obama. However, yesterday she warned Putin of taking things further, saying that countrywide economic sanctions could be imposed. This could be something that gives Putin pause for thought, with Russia heavily reliant on European trade.

Merkel said: “The European Council will make it clear today and tomorrow that with a further deterioration of the situation we are always prepared to take phase-three measures, and those will without a doubt include economic sanctions.”

In related news, Ukraine’s newly installed leadership signed an agreement for closer ties with the EU, in a show of defiance to Putin. The deal will offer political and economic support to the Ukraine, said European Council President Herman van Rompuy.

“This gesture symbolises the importance that both sides attach to this relationship, and our joint will to take it further. It recognises the aspirations of the people of Ukraine to live in a country governed by values, by democracy and the rule of law, where all citizens have a stake in national prosperity. And the popular yearning for a decent life as a nation, for a European way of life.”