New sanctions not to hit state firms, secondary Russian debt market

WASHINGTON, Aug 5 (PRIME) -- The second round of U.S. sanctions under the 2018 Skripal poisoning case does not cover Russian state companies and the secondary market of the Russian sovereign debt, the U.S. Department of the Treasury said in a August 2 directive, which will come into force on August 26.

“The following activities by a U.S. bank…including foreign branches, are prohibited…: participation in the primary market for non-ruble denominated bonds issued by the Russian sovereign… lending non-ruble denominated funds to the Russian sovereign…(which) means any ministry, agency, or sovereign fund of the Russian Federation, including the Central Bank of Russia, the National Wealth Fund, and the Ministry of Finance of the Russian Federation. This term does not include state-owned enterprises of the Russian Federation.”

The U.S. State Department said that the new sanctions also envisage U.S. opposition to the extension of any loan or financial or technical assistance to Russia by international financial institutions, such as the World Bank or International Monetary Fund (IMF) and new export licensing restrictions on Department of Commerce-controlled goods and technology.

The export restriction will cover only materials linked to mass destruction weapons, the authority added.

Confirming the new sanctions, the State Department said, “Pursuant to the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991, the United States is announcing a second round of sanctions on Russia for its use of a “novichok” nerve agent in an attempt to assassinate Sergei Skripal and his daughter Yulia Skripal in the United Kingdom on March 4, 2018.”

“As with the first round of sanctions, these measures will take effect following a 15-day Congressional notification period and thereafter remain in place for a minimum of 12 months,” the authority said.

Russian Finance Minister Anton Siluanov said that the domestic economy has proved it is resistant to external restrictions thanks to its flexible macroeconomic construction and the weighted budget policy.

The existing financial system will satisfy all budget needs in borrowed funds, he added.

In March 2018, then U.K. Prime Minister Theresa May said it was highly likely that Moscow was responsible for an attempt to murder a former officer of the Main Intelligence Directorate Skripal and his daughter. In August 2018, the U.S. introduced a first wave of sanctions against Russian under the case.

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