President Joe Biden on Tuesday said the United States would levy a “first tranche” of sanctions on two large Russian banks and “comprehensive sanctions” against Russia’s soverign debt in response to Russia’s invasion of Ukraine, calling it “a flagrant violation of international law”.
Specifically, Mr Biden announced that the US was imposing sanctions against VEB.RF — formerly known as Vnesheconombank – and Russia’s “military bank”.
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The sanctions against Russian sovereign debt, he said, would “cut off Russia’s government from Western financing” so Moscow could no longer raise capital from the west, nor trade new debt in US or European markets.
Mr Biden also said the US would begin levying more sanctions against “Russian elites and their family members” starting Wednesday, and “continuing in the days ahead”.
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“They share in the … gains of the Kremlin’s policies and should share in the pain as well,” he said. He added that the US sanctions were “closely coordinated” with US allies, and would “continue to escalate” if Russia continues on its current path. He also noted that the Russo-German Nord Stream 2 gas pipeline would not go forward “because of Russia’s actions”.
The new sanctions are in response to Russian president Vladimir Putin’s declaration that he would recognise so-called “people’s republics” in Donetsk and Luhansk — where Russian-backed separatists have been fighting Ukrainian forces since 2014 – and Mr Putin’s decision to send Russian troops over Ukraine’s border to assist the separatists.
Mr Biden’s remarks came hours after his deputy national security adviser, Jon Finer, told CNN that the Russian troop presence in eastern Ukraine constituted an “invasion” and a day after a senior administration official promised “further measures” beyond the limited sanctions imposed under a Monday executive order which narrowly targeted activities within the Donetsk and Luhansk regions.
Mr Biden said he fully expects a Russian response, and said the US will have its “next move” prepared as Russia contemplates its own.
“Russia will pay an even steeper price [for] continued aggression, including additional sanctions,” he said, adding later that his administration will use “every tool” it has to protect American businesses and consumers from any negative effects from the sanctions, particularly higher prices for oil and petrol.
“Defending freedom will have cost for us as well here at home — we need to be honest about that. But as we do this, I’m going to take robust action to make sure the pain of our sanctions is targeted at a Russian economy, not ours,” he said.
Mr Biden also said the US still believes Russia “is poised to go much further in launching a massive military attack against Ukraine”.
“I hope we’re wrong about that, but Russia “has only escalated this threat against the rest of Ukrainian territory, including major cities including the capital city of Kiev,” he said.
In response to Russia’s announcement that it would not withdraw forces that have been deployed to Belarus for purported military exercises, Mr Biden said he had authorised “additional movements of US forces and equipment already stationed in Europe” to shore up defences in Latvia, Lithuania, and Estonia. All three Baltic states are — like Ukraine — former Soviet republics, but unlike Ukraine, are Nato members.
While he described the moves as “totally defensive” and stressed that the US and Nato “have no intention of fighting Russia,” he also said the troop movements were meant to send Russia the “unmistakable message” that America and her allies “will defend every inch of Nato territory and abide by the commitments we made to Nato”.
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