The second EU sanctions package against Russia to be announced by Brussels later today is so severe that it is gradually erasing the foundations of the Russian economy. That said the European leaders last night after more than six hours of emergency deliberations. Sanctions against Belarus will follow later.
Commission President Ursula von der Leyen made it a bit clearer last night what Brussels, together with important countries such as the US, the United Kingdom, Canada, South Korea, Japan and Australia, are aiming for. These include financial and export measures, interventions in technology transfer and travel restrictions.
By cutting off Russia’s access to key capital markets, the West hopes to hit 70 percent of Russia’s banks and major state enterprises, drive up borrowing costs and inflation, and gradually destroy Russia’s industrial base. The financial sanctions also mean that the elite around President Putin can no longer hide their money in safe places around the world.
A second part of the sanctions package affects the Russian oil market, including refining, which will account for 24 billion euros in export income in 2019.
In addition, there is a ban on the sale of aircraft and aircraft parts to Russia. That will also hit the country hard because Russia is dependent on the EU, US and Canada for three quarters of its commercial aircraft fleet. Europe then expects to hit the Russian economy hard by limiting technology transfer and the supply of semiconductors, for example. This measure, according to von der Leyen, will also cost Russia a lot of prosperity.
The last measure is visa restrictions for diplomats and businessmen, who will therefore soon be much less able to enter Europe.
Specialists from the European Commission will continue to work on the package in the coming hours to make it legally watertight, the concrete measures will be announced during the day.
Putin must and will fail
Council chairman Michel spoke after ‘a massive additional package’, according to von der Leyen ‘our unity is our strength’. Putin has done everything he can to divide us but has achieved exactly the opposite. He tries by force to redraw the map of Europe, but he must and will fail.”
According to President Macron, temporary council president, the war has made it clear to Europe “in a horrific way” that it needs to accelerate work on its sovereignty, which means, among other things, energy independence and a defense strong enough to protect its borders and citizens. Macron: “We have no choice but to become a power.”
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