The Kremlin is threatening Washington, D.C., with reciprocal measures after the U.S. added more Russian firms to its sanctions list. The White House expanded restrictions already put in place in response to Moscow’s annexation of Ukraine’s Crimean peninsula and its ongoing war against Ukraine.
According to documents published by the U.S. Federal Register on Sept. 7, 81 more entities are now blacklisted, among them 11 from the Russian arms sector and 51 companies owned or operated by Russian gas monopoly Gazprom. The new additions to the sanctions list are described in the documents as “acting contrary to the national security or foreign policy interests of the United States.”
A Kremlin spokesman has said the latest sanctions are “not consistent” with talks recently held between Russian President Vladimir Putin and U.S. President Barack Obama. Dmitry Peskov revealed the two leaders discussed “possible cooperation in sensitive areas” when they met at a recent G20 summit in China. He has warned that Moscow will review the new blacklist and base its response on the principal of reciprocity.
Among the companies now subject to U.S. restrictions are the electronics firms Angstrom and Mikron. As with other enterprises subject to the measures, their exports, re-exports and ability to transfer materials and technology will be limited.
The vast majority of the newly-sanctioned entities are located in Russia but there are also a small number in Crimea, Hong Kong and India. Several are believed to be involved in the construction of a bridge across the Kerch Strait which would connect mainland Russia with Kremlin-annexed Crimea. Putin has emphasized that the $4.5 billion project, which is due for completion in 2018, is a top priority.
This most recent expansion of the blacklist by the White House comes after a similar announcement by the U.S. Treasury Department on Sept. 1 which saw 18 entities operating in Russian-occupied Crimea in the transport, construction and defense sectors come under sanctions. The companies on the list no longer have the right to conduct business with their U.S.-based counterparts.
American and European sanctions against Russia first came into force in 2014, soon after the Kremlin’s illegal annexation of Crimea in March of that year. The measures initially involved travel bans and asset freezes but were later stepped up in response to Moscow’s backing for separatist rebels in Ukraine’s eastern Luhansk and Donetsk oblasts. The restrictions have targeted Russia’s defense, energy and finance sectors, limiting the ability of firms to import technologically advanced equipment and raise funds on Western capital markets. The sanctions, combined with low global oil prices, have pushed Russia’s economy into a recession which the International Monetary Fund has forecast to last until 2017.
The Kremlin’s response to outside pressure has been to slap on counter-sanctions.
In August 2014 it introduced a ban on the import of Western food products. The embargo, which still remains in force, affects fruit, vegetables, meat, fish, milk and dairy from the U.S., the E.U., Australia, Canada and Norway. Although some producers have been able to circumvent the restrictions by sending goods via third countries such as Belarus, many have been hit hard. Polish apple farmers, who expect a record crop this year, had previously counted Russia as one of their biggest markets. They have been among those suffering the most as a result of the trade war between Russia and the West.
In Brussels, meanwhile, recent efforts by Moscow to lobby for sanctions to be lifted by the European Union have largely failed.
The E.U. voted on Sept. 7 to keep in place travel bans and asset freezes first introduced in 2014. The measures affect lawmakers, oligarchs, separatists in eastern Ukraine and two Russian celebrities who have been vocal in their support for the breakaway Donetsk and Luhansk regions.
In spite of calls from some within the 28-nation bloc for ties to be normalized with Russia, European leaders continue to link the lifting of sanctions to the fulfillment of the terms of the Minsk peace deal. That agreement, brokered with the help of France and Germany, calls for a withdrawal of Russian forces from eastern Ukraine, a lasting cease-fire, return of the eastern border to Ukraine’s control and unfetted access by international monitors.
However Moscow continues to insist it is not party to the conflict in the Donbas and accuses Kyiv of failing to uphold its part of the deal on making constitutional changes that would give more political power to the occupied regions.
In an effort to get the peace process back on track, German Foreign Minister Frank Walter-Steinmeier is due to visit Ukraine next week with his French counterpart Jean-Marc Ayrault. They are scheduled to discuss the possibility of holding a fresh round of talks with Russia. This comes following a summer which has seen violence flare on several occasions in the war zone and in occupied Crimea. The Pentagon has reported large Russian troop movements near the Ukrainian border, part of maneuvers which many analysts believe Moscow hopes will help it extract concessions at the negotiating table.
