As West Ratchets Up Economic Pain on Moscow, Will Unity Hold?

Europe is facing calls to impose immediate tougher sanctions on Russia following President Vladimir Putin’s recognition of the separatist-held regions of Donetsk and Luhansk in eastern Ukraine and his pledge to send in what the Kremlin called “peacekeeping” troops.

“We are anticipating further steps on strengthening sanction pressure,” Ukrainian President Volodymyr Zelenskyy told reporters Wednesday. “It’s important that Germany decided to halt the certification of the Nord Stream 2. It should be irreversible.”

Nord Stream 2

Berlin announced Tuesday it had officially halted the certification process for Nord Stream 2, the newly built gas pipeline that was designed to take Russian gas directly to Germany. The German move was part of a raft of sanctions announced by Western allies in response to Russia’s actions.

All 27 European Union member states agreed on a range of measures targeting Russian individuals and institutions.

EU sanctions

“We have agreed that the 351 members of the Russia State Duma who voted [for] this violation of international law and territorial integrity and sovereignty of Ukraine will be listed in our sanctions list. We agreed to target 27 individuals and entities who are playing a role in undermining or threatening Ukrainian territorial integrity, sovereignty and independency,” the European Union’s foreign policy chief, Josep Borrell, said Tuesday.

“And last, but not least, because this is very important, we target the ability of the Russian state and government to access our capital and financial market on services. … This packet of sanctions that has been approved by unanimity by the member states will hurt Russia and it will hurt a lot. And we are doing that in a strong coordination with our partners U.S., UK and Canada,” Borrell told reporters in Paris.

The European sanctions are similar to those imposed by Australia, Canada, Japan and the United States.

“Putin’s actions have really reinforced transatlantic unity. European allies and the United States have been in close coordination, and they seem to be ready to match every move of Putin,” said Sudha David-Wilp, of the German Marshall Fund of the United States, in an interview with VOA.

Russian banks

Britain announced sanctions on five Russian banks, which it said included those favored by oligarchs close to the Kremlin: Rossiya, IS Bank, General Bank, Promsvyazbank and the Black Sea Bank. Britain also imposed asset freezes and travel bans on three Russian billionaires whom it said had supported the invasion of Ukraine: Gennady Timchenko, Boris Rotenberg and Igor Rotenberg.

“We have more individuals that we will target in the event of a full-scale invasion of Ukraine and we’ll be targeting them in conjunction with our international allies like the Europeans and like the United States to make sure that these people can’t travel, that their assets are frozen and that they will have nowhere to hide,” British Foreign Secretary Liz Truss told Sky News Wednesday.

Many British lawmakers say the sanctions don’t go far enough. Speaking during a session of Prime Minister’s Questions in parliament Wednesday, opposition Labor Party leader Keir Starmer urged the government to go further. “We all want to deter aggression in Europe. We are not dealing with breakaway republics. Putin is not a peacekeeper. A sovereign nation has been invaded. The prime minister promised that in the event of an invasion he would unleash a full package of sanctions. If not now, then when?” Starmer said.

Long game

It’s important that the West holds some sanctions in reserve, says analyst Sudha David-Wilp of the German Marshall Fund.

“It’s important that the West not put everything out on the table; an element of surprise is also important. This is probably going to be a long conflict and it’s important for the West to be measured and proportionate.”

Russia has long been preparing for this moment, says analyst Amanda Paul of the European Policy Center in Brussels.

“In the last eight years, Russia has done a lot of things to move itself away from its dependency on Western finance and investments. … They have a huge wealth fund of over $600 billion in gold and foreign currency. They do have the ability to keep going for some time despite the pain. So, it means that the West will need to be very committed and very determined to keep pushing and pushing, even though for sure it’s going to cost them painful, painful moments too,” Paul told The Associated Press.

Russian gas threat

Germany’s decision to effectively cancel the gas pipeline elicited a testy response from Russian Prime Minister Dmitry Medvedev. “German Chancellor Olaf Scholz has issued an order to halt the process of certifying the Nord Stream 2 gas pipeline. Well. Welcome to the brave new world where Europeans are very soon going to pay €2,000 for 1,000 cubic meters of natural gas!,” Medevdev wrote on Twitter.

Germany has other options, according to energy analyst Claudia Kemfert of the German Institute for Economic Research, in a recent interview with VOA.

“Germany does not need Nord Stream 2. We have enough infrastructure; we have enough pipelines where we can transport and import natural gas to Germany and we can also rely on natural gas, LNG imports from other countries,” Kemfert said.

Western unity

So far, the Western response has been remarkably united – but that may become more strained, according to Nora Müller of the Körber Foundation, a foreign policy research institution in Berlin.

“The more you ratchet up the sanctions regime, the more painful it also is not only for the one who is sanctioned, but also for the one who imposes the sanctions; that’s the logic of sanctions. So, when we talk about targeting the sanctions at the Russian energy market, obviously that will be very painful for EU member states,” Müller told VOA.

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