The United States is prepared to step up sanctions against Moscow if pro-Russian military actions in eastern Ukraine continue, the US envoy to the United Nations said yesterday, but it’s unclear how far the measures can go in slowing the Russian-backed separatist revolt.
A new round of US sanctions could target Russian business sectors such as mining, banking and energy. The sanctions have been the most visible sign of US anger at Russia’s annexation of the Crimea region in southern Ukraine last month, reflecting the deepest plunge in US-Russian relations since the Cold War.
Pro-Russian activists seized government buildings on Saturday in the eastern town of Slaviansk, about 150 km from the Russian border. Ukrainian security forces were trying to oust the activists, who set up barricades on the outskirts of the city.
The American ambassador to the UN, Samantha Power, said on ABC’s This Week that sanctions already imposed by Washington have had an impact: the Russian rouble has fallen to an all-time low, the country’s stock market has depreciated by 20 per cent and investors are fleeing the country.
“The President has made clear that, depending on Russian behaviour, sectoral sanctions in energy, banking, mining could be on the table, and there’s a lot in between,” Power said.
“I think we’ve seen that the sanctions can bite, and if actions like the kind we’ve seen over the last few days continue, you’re going to see a ramping up of those sanctions.”
Obama’s failure to punish Russia over Crimea has only emboldened Putin
But beyond declines in the rouble and Russian share indexes, the impact of the sanctions has been modest. In fact, billionaire oil and gas trader Gennady Timchenko told Russian TV on Saturday his inclusion on the US sanctions list had caused minor problems, mainly because some European banks had become wary of carrying out transactions with any entities linked to him. But he said for him personally, being on the list was “quite an honour.”
The next round of US sanctions against Russia is likely to target influential people or firms in its business sectors, such as energy, engineering and financial services, as spelled out in President Barack Obama’s executive order last month. The goal is to put more pressure on Russian President Vladimir Putin’s closest business allies. Republican Senator John McCain, a frequent critic of US policy on Ukraine, said on CBS the Obama administration’s failure to punish Russia over Crimea has only emboldened Putin.
“It’s obvious that he is encouraged by the fact that we sanctioned a few people and suspended (Putin) – didn’t even throw him out – of the G8.”
McCain repeated his calls for tougher sanctions and for giving Ukrainians light weapons so that they can defend themselves.