New Sanctions Against Russia Will Hurt West Most – Media

New Sanctions Against Russia Will Hurt West Most - Media New Sanctions Against Russia Will Hurt West Most - Media

New Sanctions Against Russia Will Hurt West Most – Media

Topic: Sanctions Against Russia

MOSCOW, July 31 (RIA Novosti) – The latest package of sanctions imposed by the United States and the EU against Russia will mostly hurt the West, thus solidifying Russian President Vladimir Putin’s positions, the BBC reported.

“This [new package of sanctions] will ultimately hurt the City [of London], as well as New York, because for the first time, the Russians are going to realize that they in fact can live without the global financial services industry,” the BBC quoted banking expert Ralph Silva as saying.

According to Silva, as a result of sanctions, Putin’s positions will only strengthen.

“Putin has been strengthened as a result of the sanctions. The Russian public is seeing him as the protector and if he gets the country through these sanctions, he will solidify his hold on power,” Silva added.

According to the BBC’s article, the European Union takes more than 45 percent of Russia’s exports. Less than 3 percent of the EU’s exports go to Russia.

BANKING SECTOR

London-based financial analyst Chris Skinner, in an interview to the BBC, said that sanctions on banks might force Russia to find alternatives to London.

He said the restrictions “could kill the Russian flow of capital through our markets if there is an alternative. For example, would they switch to Hong Kong or Shanghai?”

Earlier, Russia’s Bank of Moscow said that business was not suffering from sanctions and that it was not planning to borrow on foreign markets.

Russia’s state-owned VTB Bank’s representatives said the sanctions are likely to cause economic harm to all parties.

DEFENSE INDUSTRY

As well as financial restrictions, the European Union now has a list of arms that are prohibited for sale to Russia. There are also restrictions on Russian arms exports.

“Considering relatively low volumes of arms trade between the EU and Russia, the sanctions are more symbolic, especially seeing that France is holding on to the two Mistral-class helicopter carriers deal with Russia,” the BBC quoted Lilit Gevorgyan, an analyst at IHS Global Insight, as saying.

“While Russia is the second-largest arms exporter in the world, its military imports from the EU are limited in volume,” Gevorgyan added.

According to the BBC, Russian defense corporations have repeatedly stressed that the US customers would be missing out as a result of the embargo.

ENERGY SECTOR

The European Union did not go as far as limiting oil and gas imports from Russia, as it would seriously hurt European economy.

The EU banned exports of technology systems for use in energy exploration instead.

In response to the sanctions, Russian gas giant Gazprom announced that it would now source its gas turbine spare parts locally instead of relying on imports, the BBC reported.

The European Commission published Wednesday the names of eight individuals and three additional Russian entities targeted by sanctions over their alleged roles in the escalation of the Ukrainian crisis.

The first round of sanctions against Russia was implemented by the United States and the European Union back in March as a response to Crimea’s reunification with Russia following a referendum.

The new addition brings the number of persons and entities under EU restrictions to 95 persons and 23 entities.

The Russian Foreign Ministry warned that a new wave of western economic sanctions against Russia’s energy sector will drive up European energy prices and hurt the 28 member states as much as Russia.

Moscow has repeatedly said that these measures are counterproductive and called the sanctions “a road to nowhere.”

 

Political Scientist Says Western Sanctions Will Not Change Russian Mentality

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Russians, like most great powers, fight tooth and nail to protect what they see as their vital national interests, the expert stated.

MOSCOW, September 2 (RIA Novosti) – Sanctions imposed on Russia by Western countries over the crisis in Ukraine are unlikely to change the mentality of Russia, Tom Switzer, research associate at the United States Studies Centre at the University of Sydney, told Radio VR.

“Ukraine is a vital interest of Russia. The Russians, like most great powers, fight tooth and nail to protect what they see as their vital national interests and will doggedly guide what they perceive as their sphere of influence,” the editor of Spectator Australia and American Review explained.

Moreover, “there is fundamental misreading in Washington and Brussels about Putin’s motivation,” the expert stressed. They blame Russia for the escalating conflict in Ukraine and seem to ignore the fact that Russia’s conduct has largely been defensive. “Given the main narrative in the West, it’s not surprising that countries feel that they can punish and isolate Moscow in order to make Mr. Putin change.”

Switzer recalled Henry Kissinger’s opinion piece in the Washington Post reaffirming that Ukraine should indeed become a buffer state between the East and the West. The expert also said that Ukrainian President Poroshenko has to respect the rights of ethnic minorities that populate eastern regions of the country. Switzer is convinced that will put an end to the crisis. However, “that requires a complete transformation in the thinking in Washington and Brussels.” Regrettably, at this stage that seems unlikely.

Switzer also pointed out that sanctions are counterproductive – the point Moscow has repeatedly made -and primarily affect Western Europe. “The heavy lifting will mainly come from Western Europe if the sanctions are to have any impact.” As a result, some Western European countries “are splintering away from both Washington and Brussels largely because [they] are so dependent on Russia” and likely to pay a higher price than Moscow.

The Eurozone economy has been sluggish since the financial crisis of 2008. Already there is evidence that some countries in the Eurozone are heading back into recession. “Why on Earth would those countries want to punish Russia at a time when they will have to pay a higher price?” the expert asks. That’s why in the coming months some Western European countries may well soften their position” regarding Russia’s role in the Ukrainian crisis.

Australia’s Abbot Announces New Sanctions Against Russia

Commenting on the latest round of sanctions announced by Australia on Monday, Switzer said that “when all things are considered, the renewed round of sanctions will have little consequence because the two-way trade between the countries is only about $200 million.” Indeed, Russia is not a major market for Australia or for that matter for the US.

Switzer is convinced that “tit-for-tat sanctions ultimately don’t satisfy anyone.” However, there have been several calls for the government of Tony Abbott to refuse to invite Russian President Vladimir Putin to the upcoming G20 summit in Brisbane. This is in retaliation not so much for the situation in Ukraine but for the Malaysia Airlines tragedy. Although there is no evidence to support that, some hold Moscow responsible for the MH17 plane crash that left 298 people including 38 Australians killed. “This is an issue that resonates with a lot of Australians.”

Switzer stated that “the point of the institutions like the G20 is not that they are a reward for making other states conform to Western expectations. They provide the means to deal with common challenges.” Therefore, banning Putin from participating in the G20 summit in November will be a mistake, the expert asserted. “There is more to be lost than gained by banning him.”

Breaking off ties with Moscow would be unwise for Australia and the West in general. But isolating Russia is a dead-end strategy, Switzer warned. “Isolating Russia will drive Moscow closer to China and that’s not in the interest of Australia or our great and powerful friend, the United States,” the expert said.

Western Sanctions Not to Weaken Russian Banks’ Credit Capacity – Fitch

Topic: Sanctions Against Russia

Fitch Ratings

Fitch Ratings –

© maga.econ.msu.ru

 

MOSCOW, August 1 (RIA Novosti) – New US and EU sanctions against Russia will not harm the credit capacity of the Russian economy and the blacklisted banks, the Fitch ratings agency said on Friday.

“New sanctions, announced this week by the European Union and the United States, combined with increased international tension, will not materially impair the credit profiles of either Russia or the banks, directly affected by the sanctions in the near term,” Fitch Ratings said in a statement.

On Thursday, the European Union officially blacklisted Russia’s largest state-run banks for Russia’s alleged role in the escalation of the Ukrainian crisis. Sberbank, VTB, Gazprombank, Vnesheconombank and Rosselkhozbank were barred from raising financing on western capital markets.

The United States also imposed new economic sanctions against Russia on July 29, targeting three major banks — VTB Group, Bank of Moscow and Rosselkhozbank.

Fitch said the state-run banks, including their domestic subsidiaries, had external liabilities of about $137 billion at end the first quarter, or 64 percent of the outstanding amount of the banking system as a whole. Russian banks sourced about $20 billion of those liabilities from foreign subsidiaries.

Fitch said that despite the sanctions the acceptable liquidity of the banks under Western restrictions lowers the chances of higher restructuring risks. The Russian government’s support could also have a positive effect on local creditors.

However, capital markets are likely to remain closed for Russian companies in 2014-15, which would require internal restructuring of the corporate and banking sectors.

Fitch analysts forecast the reserves of the Central Bank of Russia to fall to $450 billion by the year-end from the current $472.5 billion, and further to $400 billion by the end of 2015. Should the capital outflow continue, Russia risks losing even more in reserves.

 

Obama & State Dept. contradict each other on ‘Russian troops in Ukraine’ – Putin’s spokesman

 

RT – Published time: September 03, 2014 20:23

Published time: September 03, 2014 20:23 Edited time: September 04, 2014 01:35

An east-Ukrainian rebel inspects a gun at a destroyed war memorial at Savur-Mohyla, a hill east of the city of Donetsk, August 28, 2014. (Reuters / Maxim Shemetov)

 

The US President says it is now “provable” that “Russian combat forces and tanks” moved into Ukraine. But Kremlin says Obama’s words are in conflict with the State Department that said it has no proof of Russian troops in the area.

A statement from the Russian president’s spokesman Dmitry Peskov came in response to Barack Obama’s address to the Baltic States’ leader. Speaking ahead of NATO summit, President Obama said that the US has no doubt that Russian troops are involved in the fighting in eastern Ukraine.

“The Russian forces that have now moved into Ukraine aren’t on a ‘humanitarian’ or ‘peacekeeping mission.’ They are Russian combat forces with Russian weapons in Russian tanks. There are Russian warheads with Russian weapons and Russian tanks. Now, these are the facts. They are provable. They’re not subject to dispute,” Obama said at a press-conference in Tallinn.

However, this information comes into conflict with the recent statement of the US State Department, Peskov said.

“We have repeatedly said there are no Russian troops on the territory of Ukraine. While Obama says there can be no doubts about that, US Department of State officials say simultaneously with their president that the United States has no proof of Russian military presence in Ukraine. This situation underscores their reluctance to use facts,” the Russian president’s spokesman Dmitry Peskov told the Russian News Service radio station.

“It’s an obsession with attributing a negative role in the development of the Ukrainian crisis to Russia, and we strongly object to this,” Kremlin’s spokesman added.

 

Press conference by Vladimir Putin

On Tuesday the US State Department spokeswoman told reporters that the US does not have “anything new to confirm” that Russian military moved into Ukraine.

The only information the US has on the movement of Russian troops across the Ukrainian border was “confirmed” last week, Jen Psaki said, referring to NATO’s satellite images released as a “proof” of Russia’s military involvement in Ukraine.

Remember Iraq? Former US intel officers warn Merkel against NATO images of Ukraine

The images were ridiculed by Russia’s Defense Ministry, while an alliance of seven former US intelligence officers – the Veteran Intelligence Professionals for Sanity (VIPS) – said the evidence produced by NATO from the Ukrainian-Russian border was on a par with the “same dubious, politically ‘fixed’ kind used 12 years ago to ‘justify’ the US-led attack on Iraq.”

‘Many of our comrades can’t look quietly’

On Wednesday, Russian veterans have called to end speculations around those Russian men who voluntarily joined east-Ukrainian rebels in the fight against Kiev.

“These are not adventurers, not criminals, not mercenaries, these are Russian people, who have it already laid down in their genes: to help our friendly nations in a difficult situation. We understand that this internal conflict or civil war in Ukraine is not Russia’s business. But this way Russia [through volunteers] has a right to help,” said Colonel-General Valery Vostrotin, the chairman of the Council of the Moscow Department “Battle Brotherhood”.

Several veterans’ organizations have issued a statement in which they explained what makes them, retired military servicemen, take arms again.

“Many of our comrades can’t look quietly [at what is happening in Ukraine] and take part in this conflict,” Igor Shevchuk, a veteran of Alpha special forces, said.

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A retired Russian officer Vladimir Melnik is one of those men. He is now undergoing treatment in Moscow after being injured in leg in Ukraine.

He does not call himself a hero. For him, born and raised in the Donetsk region, when it still was part of the USSR, supporting rebels in his native land is a duty. His relatives and friends still leave there. Melnik says he could not leave them in trouble.

“If somebody intrudes into you house, starts killing your brothers, your sisters, raping your women, killing your children and rob elders how would you react to this? I understand that this is, primarily, a spiritual struggle; looking at what is happening in the world today, I would not like to stand and watch as our Orthodox people are being killed in their own home,” he says.

melnikov

Melkin says there are many volunteers – former military personnel like him – fighting along with self-defense forces in the south-east of Ukraine.

“There are many of us and more people were ready to come. For now, Thank God, we are coping [with the situation] with the tools we have,” Melnik says.

When asked if he was paid or offered anything for coming to Ukraine, he says: “If I came to my father and said: Dad, I’m here to protect you from fascists for money, he would not understand me, neither would others. I wouldn’t have any respect to myself as well.”

Melnik says it was tough for eastern Ukrainian men “to leave their mines” and take arms, but now, thanks to the experience which people with military background shared, they “understand more.”

Asked about military equipment, Melnik confesses that everything rebels have is old, “from the Soviet time”, but this is enough to hold the fort.

“It is not difficult to find arms in Ukraine,” he says. “There are many ammunition depots left after the Soviet Union. It is old, from Soviet times. Yes, guys had to repair some of it or replace some of the details, but it works.”

 

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OSCE: No armed men crossing Ukraine border

OSCE’s observer mission has indicated in its latest report that it has not witnessed any Russian troops or tanks crossing the border into Ukraine.

What it did record, however, was an increased presence of unmanned aerial vehicles and young men and women crossing from Russia into Ukraine unarmed.

There has been “increased military activity principally of unmanned aerial vehicles (UAVs) in the vicinity of the Border Crossing Points,” OSCE said in the weekly update from August 28 to September 3.

“Throughout the week, the OTs [Observer Teams] noticed a net increase of young people (both men and women) wearing military-style dress crossing the border in both directions but did not observe any weapons among these groups.”

OSCE noted that supporters of self-defense forces said they are not allowed to cross the border with weapons. But once they cross into Ukraine, weapons can be obtained from self-defense forces.

The observer mission added that situation in Lugansk remains “dire.” OSCE cites accounts of “severe destruction caused by artillery fire which resulted in the interruption of water, gas and electricity supplies, the latter apparently unavailable for more than five weeks in some areas including Lugansk city itself.”

New Anti-Russia Sanctions Could Put ExxonMobil Investments in Jeopardy – NASDAQ

Topic: Sanctions Against Russia

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ExxonMobil is the world’s largest company by revenue.

 

MOSCOW, September 1 (RIA Novosti) – If sanctions against Russia broaden in the coming months Exxon may be affected by transfer restrictions on technology, NASDAQ reported on Monday.

New Western sanctions against Russia may put the $3.2 billion Exxon agreed to invest in the joint venture at risk, NASDAQ reported. In the long-term Exxon’s investments may be in jeopardy.

But the latest round of US and EU economic sanctions against Russia, targeting important banking and energy companies and preventing them from accessing Western debt and equity financing, as well as from selling and transferring Western technologies and equipment to the Kremlin, will not have near-term impact on ExxonMobil.

“Despite current political difficulties, pragmatism and common sense will prevail,” Russian President Vladimir Putin said on August 11 as he gave his assent for Exxon, in partnership with Rosneft, to begin drilling Russia’s northernmost oil well in the Arctic Ocean.

Exxon Mobil Corp., or ExxonMobil is an American multinational oil and gas corporation working closely with Rosneft in various regions of Russia. Unlike BP (BP Russian Investments Limited), which owns 19.75% of Rosneft’s registered capital, Exxon doesn’t own an equity stake in Rosneft.

Through its joint venture, Exxon holds 85,000 net acres in Sakhalin and 11.3 million net acres in the Kara and Black Seas. This acreage contains a number of producing wells that contributed an estimated 6% of Exxon’s total production last year. Nevertheless, the new round of sanctions will not affect Exxon’s near-term perspectives in Russia.

China, India to Replace Canada, Australia, US as Meat Suppliers to Russia

Sergei Dankvert, the head of Rosselkhoznadzor

Sergei Dankvert, the head of Rosselkhoznadzor

© RIA Novosti. Sergey Subbotin

19:43 20/08/2014

 

Topic: Russia Responds to Western Sanctions

MOSCOW, August 20 (RIA Novosti) – Chinese and Indian meat is to replace banned pork and beef exports from the West, which will not succeed in reclaiming its position on the Russian market if the embargo is lifted, Russia’s relevant authority said Wednesday.

“For example, Russia’s Far East used to be heavily reliant on meat supplies from the United States and Canada. Now that [we are] actively cooperating with China’s veterinary authorities on … pork supplies from certain highly-integrated Chinese enterprises, the US and Canadian suppliers will not be able to come back,” Sergei Dankvert, the head of Russia’s Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor), said in a statement released on the agency’s website.

According to data from Russia’s Federal Customs Service, Moscow imported 619,200 tons of pork for $2.13 billion in 2013. Brazil, Denmark, Germany and Canada were the principal suppliers of the meat. Canada exported 79,300 tons of pork to Russia in 2013 for $246.3 million, while US pork exports had reached $19 million per year.

In 2013, Russia imported 658,400 tons of cooled and frozen meat, valued at $2.87 billion, with Belarus and Brazil among the top exporters.

On August 7, Moscow banned the importation of certain food and agricultural products from EU member states, the United States, Canada, Australia and Norway, all of which had previously imposed economic sanctions against Russia. The list includes beef, pork, fruit and vegetables, poultry, cheese and dairy products, and a number of other items.

The Netherlands’ economy will lose at least 300 million euros ($400 million) due to the Russian food embargo, Reuters reported Tuesday, citing statistics bureau Statistics Netherlands, RIA Novosti informed.

(RIA Novosti) Moscow will consider additional protective measures if the West continues its destructive sanction policy, Kremlin spokesman Dmitry Peskov said Tuesday.

“Different variants are being developed. We have said several times that Russia is not a fan of speaking in terms of sanctions and has not been an initiator. But if our partners continue their non-constructive and even destructive practices, then additional measures will be developed,” Peskov said.

 

 

 

 

 

Obama’s Obsession with Russia/Putin Urging Asian Countries to Support New Sanctions Against Russia – Reports

White House

The White House

 

Topic: Sanctions Against Russia

MOSCOW, July 30 (RIA Novosti) – Washington is seeking a number of Asian countries to back new US and EU economic sanctions against Russia, The Wall Street Journal reported Wednesday citing a senior State Department official.

The US diplomat said he has met government officials in China, Singapore and South Korea this week to provide “a brief on what we’ve done, answering questions and seeking support,” according to the report.

“It’s certainly our hope that countries in this region — which includes many significant financial and commercial centers — would join us in putting pressure [on Russia],” the senior official said.

The diplomat didn’t give details of the results of the talks but noted that “good and open exchanges of views” took place.

The US official is to hold similar meetings in Japan on Thursday and Friday, according to the newspaper.

Meanwhile, a spokesperson for South Korea’s Foreign Ministry told The Wall Street Journal that Seoul hasn’t committed to any sanctions against Russia. The representative added the talks with US officials involved not only Russia but also other issues, including Iran.

On Tuesday, the Chosun Libo newspaper reported that Peter Harrell of the US State Department arrived in Seoul in order to persuade South Korea to impose sanctions against Russia.

The same day, the United States as well as the European Union announced new rounds of sanctions against Russia, once again accusing Moscow of supporting militia forces in eastern Ukraine.

Washington introduced sanctions on three more Russian banks, namely VTB, the country’s second-largest bank, the Bank of Moscow and Russian Agricultural Bank, as well as state-owned United Shipbuilding Corporation.

The EU agreed on a new set of sectoral economic sanctions against Russia, which will be published on July 31 and go into effect on August 1.

Russia’s envoy to the European Union, Vladimir Chizhov, said last week that the sanctions were “a road to nowhere” and Prime Minister Dmitry Medvedev said such actions toward Russia were a way to conceal protectionist measures in the interests of certain companies.

A recent opinion poll by the Levada Center indicates that amid tensions over Ukraine and the takeover of Crimea, Russian President Vladimir Putin’s popularity rating is at its highest point since 2010. Yet the events of this year have taken place against the background of an economic slowdown. However, in the first several months of 2014, the number of Russians who approve of Putin’s actions as president rose from 65 percent in January to 82 percent in late April. At the same time, the approval ratings of the government and the prime minister received a boost, as did Russians’ readiness to vote for the ruling party and overall optimism.
Firstly, the president’s rating rose by four points on Russia’s performance in the Olympic Games. Russia’s involvement in the events in Ukraine and the takeover of Crimea gave him a further 11 points. Additionally, Putin’s televised phone-in with the nation, practically the whole of which was devoted to the situation in Crimea and Ukraine, allowed him to consolidate this success. It added a couple of more percentage points to the president’s rating at a time when other ratings [the approval of the government and the prime minister, readiness to vote for the ruling party and overall optimism.
The return of Crimea to Russia, gave the ratings a boost for several reasons. The threat of a military conflict always means that one has to choose between “us” and “them”, which inevitably prompts people to rally around the leadership of their country.
The peninsula’s return to Russia (as the president put it) is perceived by the majority of Russians not just as historical justice and as an alleviation of the ‘phantom’ pain for the lost status of “a great power”, but as a noble act. The opinion that Crimea should be returned to Russia and that the Russian leadership should defend the interests of Russians in former Soviet republics has been prevalent since the early 1990s.
An overwhelming majority of Russians are convinced that in Ukraine, Russia has extended a helping hand to the Russian-speaking population, has defended them from an inevitable death at the hand of “fascists” and “nationalists” who have come to power in Kiev, as this is what the country’s main TV channels have been saying for months. Moreover, in the opinion of the majority of Russians, Western governments are only hindering the resolution of the crisis, while pursuing their mercenary goals.
“The Ukraine story” has been effectively presented to the Russian population in a very attractive light, and is essentially unrecognizable from the way it is presented outside Russia. Finally, it matters too that, in the opinion of the majority of Russians, the annexation of Crimea and involvement in Ukrainian affairs has hardly cost Russia anything.
The Crimea events took place with the loss of just one life; as for the Western sanctions, Russians do not really believe in them and cannot assess their consequences, since this is something that evening TV news broadcasts hardly ever mention. While it is evening TV news (primarily on the three main state-owned channels) that provides 90 percent of Russians with their information on domestic and world events, the internet serves as the main source of news for 15-20 percent of the population, although there too the audience of independent and good-quality information resources that represent a variety of views and opinions make up just a fraction. An overwhelming majority of Russians do not have access to information that offers other than the official line – this is not true.
Readers from the Russian Federation often visit our Music site offering information hidden by the American mainstream press.

The Crimea story has improved the image that Russian politicians have in Russians’ eyes but it has had no effect on the overall assessment of the economic situation, not as bad as the fragile European Union.  In other words, no situational mobilization of public opinion can change a long-term trend that has been established by the economy. That is why Putin’s further popularity as well as the stability of the political system as a whole will depend on how good or bad economic growth is.  In the United States,however, President Barack Obama’s popularity rating is at its lowest point – 30 percent, with most criticism directed to his lack of a foreign policy and an stagnant economy.