The Kremlin said on Friday that Western sanctions imposed on Russia for its invasion of Ukraine would cause problems for Moscow, but not insurmountable ones. Russia is set to widen its trade and economic ties with Asian countries.
Kremlin spokesman Dmitry Peskov said that while sanctions would cause some problems, Russia had deliberately reduced its dependence on foreign imports to protect itself against sanctions, reports Reuters.
Russia is also planning to impose retaliatory sanctions on Western nations on the basis of reciprocity, Peskov said.
He declined to comment on how long Russia’s invasion of Ukraine, which prompted the sanctions, would last and said questions about Ukrainian civilian deaths should be referred to the military.
New sanctions announced
Western countries have announced new sanctions on Russia, including shutting the government and banks out of global financial markets, restricting technology exports, and freezing assets of influential Russians.
European Commission President Ursula von der Leyen said the EU now targets 70 percent of the Russian banking sector and key state-owned companies and is seeking to make “it impossible for Russia to upgrade its oil refineries.”
“We are also targeting Russian elites by curbing their deposits so that they cannot hide their money anymore in safe havens in Europe,” she added, reports CNN Business.
Ukraine is also urging the West to ban Russia from SWIFT, the high-security network that facilitates payments among 11,000 financial institutions in 200 countries.
And it is not as if Russia doesn’t know what sanctions are – they have lived with them since annexing Crimea in 2014.
“We understand that the sanctions pressure we have faced since 2014 will now intensify,” the economy ministry said, referring to measures imposed after Russia annexed Crimea from Ukraine.
“The rhetoric of some of our foreign colleagues was such that we have been ready for potential new sanctions for a long time.”
How far is the West willing to go?
How far the West and the European Union will go in handing out harsher sanctions is a question fraught with huge repercussions, not only for Russia’s economy but for the European countries that rely on Russian exports of gas and oil.
According to the New York Times, in recent years, the European Union has received nearly 40 percent of its gas and more than a quarter of its oil from Russia.
Cutting off all exports of gas and oil would, indeed, be very hard on Russia, which relies heavily on energy exports to finance its government operations and support its economy. Actually, over one-third of the country’s national budget is dependent on oil and gas exports.
The crux of the matter is that the global community doesn’t realize just how intertwined Russia and the West really are, economically. Years ago, as the Cold War ended, analysts believed that this inter-relationship would be good for the world because it would mean that conflicts were less likely to arise.
Trade and economic self-interest would ultimately make allies out of everybody, the argument went. However, while mutual interest is a good thing, the flip side of the coin is “mutual pain.”
European leaders are caught between wanting to punish Russia for its aggression and to protect their own economies.
So, this war of aggression by Russia on Ukraine is not as simple as it appears to be on Television. And it now involves the global economy.
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Disclaimer
The opinions expressed in this Op-Ed are those of the author. They do not purport to reflect the opinions or views of the Digital Journal or its members.
