US, UK, other world powers slap sanctions on Russia over Ukraine

WASHINGTON/LONDON/GENEVA/PARIS/BRUSSELS/ROME/TOKYO/MOSCOW/SIMFEROPOL, Feb 25 (PRIME) -- The U.S., the U.K., and other world powers have imposed or agreed to impose punishing sanctions on Russia, its top officials, state banks, and whole sectors of the economy over the country’s military operation in Ukraine.

“Today I’m authorizing additional strong sanctions, and new limitations on what can be exported to Russia. This is going to impose a severe cost on the Russian economy both immediately and over time,” U.S. President Joe Biden said late on Thursday in a news conference.

Washington imposed sanctions on Russia’s four largest banks, including VTB Bank, and wants to sever the top Russian bank Sberbank from the U.S. financial system. The sanctions will cover the bonds of Russia’s largest state-controlled companies, he said.

Biden also said that he and other G67 leaders agreed to introduce devastating sanctions and other economic measures on Russia to punish it for actions in Ukraine. The G7 countries will restrict Russia’s ability to carry out business in the U.S. dollars, British pounds, and Japanese yen. The sanctions will be tantamount to a shut off from the SWIFT interbank messaging system. However, and the possibility of Russia’s severance from SWIFT is still on the table, he said.

The U.S. is also ready to introduce personal sanctions against Russian President Vladimir Putin, and the U.S. guarantees consequences for Moscow’s actions in Ukraine, he said.

The U.S. is also in contact with India on the anti-Russian sanctions, and the G7 plans to limit Russia’s capabilities in the hi-tech sphere, Biden said.

The U.S. Treasury said in a statement that the new sanctions cover the top managers of Sberbank and VTB Bank Alexander Vedyakhin, Andrei Puchkov, and Yury Solovyov. At the same time, the authority ordered all U.S. financial institutions to close any Sberbank’s correspondent accounts in 30 days. All payments that Sberbank plans to carry out in the U.S. dollars for its U.S. clients will be denied when they are transferred to any U.S. banks, the Department of the Treasury said.

The sanctions also block activities of Otkritie Financial Corporation (FC) Bank, Novikombank, and Sovcombank. Personal sanctions are again slapped on Rosneft CEO Igor Sechin, Security Council Secretary Nikolai Patrushev, and Sergei Ivanov, Putin’s special representative for environmental activities, ecology and transport due to their closeness to Putin.

The new sanctions limits borrowing capabilities of 13 Russian state and private companies and banks, including gas giant Gazprom, its oil subsidiary Gazprom Neft, oil company Transneft, telecom giant Rostelecom, hydropower giant RusHydro, diamond mining giant ALROSA, shipping company Sovcomflot, Russian Railways, Gazprombank, Russian Agricultural Bank, Alfa-Bank, and Credit Bank of Moscow.

The U.S. also imposed export control of the Russian defense, aerospace, and maritime industries.

The Department of the Treasury excluded the agriculture sector and supplies of medicines and medical equipment from the sanctions.

U.S. Deputy National Security Advisor Daleep Singh said that the new sanctions should weaken the ruble and cut investment in Russia, but the U.S. doesn’t want to disrupt Russia’s exports of energy sources to the global market. Washington wants to have an impact on Russia’s production of energy sources in the long term, he said.

Suzanne Clark, president and CEO of the U.S. Chamber of Commerce, said that the U.S. business community will support the new sanctions against Russia.

UK SANCTIONS

British Prime Minister Boris Johnson froze all assets of VTB Bank in the country and  prohibited  national flagship carrier Aeroflot to land in the U.K.

London also limited the amount of deposits that the Russian citizens are allowed to have on accounts in the U.K. to 50,000 British pounds, he said.

“We will continue on a remorseless mission to squeeze Russia from the global economy piece by piece, day by day and week by week,” he said, adding that a shut-off from SWIFT is possible for Russia in the future.

Following the announcement, the British Civil Aviation Authority suspended Aeroflot’s permits to fly to and from Britain.

The U.K’s sanction list includes sanctions against VTB Bank Vice President Denis Bortnikov, Promsvyazbank CEO Pyotr Fradkov, petrochemical holding Sibur shareholder Kirill Shalamov, United Aircraft Corporation (UAC) CEO Yury Slyusar, and Novikombank CEO Yelena Georgiyeva. The sanctions were also slapped on several military and state-controlled companies, including state industrial corporation Rostec, UAC, Tactical Missiles Corporation, tank producer Uralvagonzavod, VTB Bank, and Aeroflot.

The British Foreign Ministry said it was working with its allies to cut Russia off SWIFT.

EU SANCTIONS

The E.U. leaders agreed to hurt the Russian financial, energy, transport, dual-use goods sectors, as well as the visa policy, European Council President Charles Michel said on his Twitter page following an emergency E.U. summit.

French Foreign Minister Jean-Yves Le Drian said that the E.U. sanctions would be aimed at stifling the economic activity of Russia.

European Commission’s President Ursula von der Leyen said that the second package of sanctions, which the E.U. had approved, will cover 70% of the Russian banking sector and key state-controlled companies, including defense companies. The sanctions will hurt the energy industry, prohibiting the oil exports and making work of oil refineries impossible.

The E.U. will ban sales of all aircraft, spare parts, and equipment to the Russian airlines triggering degradation of civil aviation. The union also will restrict Russia’s access to modern technologies, especially in the sphere of microchips, she said.

The E.U. will also retract privileged access of Russian diplomats and businessmen to the European countries.

This winter the E.U. already has enough natural gas in storages and may completely ban Russian gas imports, she said.

German Finance Minister Christian Lindner said that a shut-off of Russia from SWIFT is still possible.

CANADIAN SANCTIONS

Canadian Prime Minister Justin Trudeau slapped new sanctions against Russia’s top banks, and immediately suspended all acting export permits for Russia.

The country imposes sanctions on 58 firms and individuals, including the Russian elite and members of their families. The sanctions cover members of the Security Council and the heads of the Defense, Justice, and Finance Ministries, he said.

The Canadian government imposed sanctions on the deputies of the Russian parliament’s lower house State Duma that voted to recognize the self-proclaimed Donetsk and Luhansk people’s republics, on 31 key members of Putin’s inner circle, 27 key financial institutions, and state companies. The total list of individuals hit by the sanctions comprises 382 names.

The sanctions were also imposed on the central bank, Sberbank, VTB Bank, Alfa-Bank, Gazprombank, Rostec, Rostelecom, RusHydro, ALROSA, Russian Railways, UAC, Tactical Missiles corporation, Gazprom, Gazprom Neft, Transneft, and the Finance Ministry.

SANCTIONS OF OTHER COUNTRIES

French President Emmanuel Macron said that France would impose its own sanctions on Russia in addition to the E.U. sanctions later.

Japanese Prime Minister Fumio Kishida said in an emergency news conference that the country banned exports of semiconductors to Russia, in addition to the sanctions announced on Wednesday. At the same time, Japan excluded energy from its anti-Russian sanctions, he said.

Japanese news channel TBS news channel reported quoting Finance Minister Shunichi Suzuki that Japanese sanctions will hit three state banks – VEB.RF, Promsvyazbank, and Bank Rossiya.

Fabian Maienfisch, a spokesperson for Switzerland’s State Secretariat for Economic Affairs, told PRIME that the country planned to introduce measures against the Russian top officials listed in the E.U. sanctions very soon.

Taiwan also joined the international economic sanctions against Russia, but did not disclose a list of measures.

New Zealand banned exports of military-use goods to Russia, and froze consultations between the foreign ministries of the two countries, Prime Minister Jacinda Ardern said in a statement.

British car producer Rolls Royce said that it suspended purchases of Russian titanium.

RUSSIA’S RESPONSE

The Russian Foreign Ministry said in a statement that the first package of the E.U. sanctions was illegitimate and ungrounded.

Russian ambassador to the E.U. Vladimir Chizhov said in an interview to Rossiya 24 television channel that Moscow will retaliate to the new E.U. sanctions adequately and fittingly. The E.U. should understand that the sanctions against Russia will hurt the economies of the E.U. countries as well, and the possible prohibition of visas to the Russians will deal a serious blow to the economy of European countries.

The Federal Air Transport Agency said that the British ban on flights of Aeroflot violates the agreement on air travel, and that Moscow can introduce mirror-like measures in response.

Russian ambassador to Canada Oleg Stepanov told PRIME that Moscow reserves the right for a symmetric or asymmetric response to the Canadian sanctions.

The central bank said that all the sanctioned Russian banks had already drafted measures to ensure their continuous operations, while the regulator and the government will provide necessary support. All the sanctioned banks have a high degree of stability and potential for business development.

All clients of the sanctioned banks will be able to receive money from their foreign currency deposits and accounts, the central bank is ready to support the banks in rubles or in foreign currency.

Sberbank said that it was studying the new conditions after the announcement of the U.S. sanctions, and that it has enough experience and expertise to work successfully.

VTB Bank said that it had already developed different plans to minimize damage for its clients. It also sold two shares of Post Bank to the latter banks’ new CEO Alexander Pakhomov.

RusHydro, Rostelecom, Gazprombank, Alfa-Bank, Otkritie FC Bank, and Sovcombank said that the sanctions would have no impact on their operations.

Sergei Tsekov, Russian senator representing Crimea, said that the U.S. sanctions against Russia would hurt the U.S. instead, and that Russia would not be scared by them.

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