News / Europe

Russia Lashes Out at Latest Western Sanctions

A sign showing the logo of Russia's VTB Bank is seen along a road in Moscow, July 17, 2014.
A sign showing the logo of Russia's VTB Bank is seen along a road in Moscow, July 17, 2014.
VOA News

Russia is lashing out at new U.S. and European economic sanctions imposed to protest what the West sees as Moscow's intervention in Ukraine.

The Russian Foreign Ministry Wednesday called new restrictions targeting the Russian energy, defense, technology and finance sectors "destructive and short-sighted."  It said Washington is behaving in a "pretentious, prosecutorial manner" that will lead to "further aggravation of U.S.-Russia relations."

The new sanctions, the strongest against Moscow since the Cold War, are aimed at further weakening a Russian economy already sliding toward recession.  U.S. officials say the newest restrictions could affect 30 percent of Russia's banking sector, with other sanctions curbing exports and business with Russian companies.

New US, EU sanctions on Russia

  • Until July 29, 2014, sanctions solely targeted individuals and organizations accused of directly threatening Ukraine and its interests
  • New sanctions prohibit Russian state-owned banks from raising funds in Western capital markets
  • About 30% of Russia’s banking sector will be impacted
  • Energy-related technology used for Russia’s oil exploration and development is blocked
  • Affected areas include technology relating to deep-water or Arctic drilling and exploration projects
  • EU officials say the ban extends to about 10% of overall energy exports to Russia
  • Restrictions on Russian arms exports
  • A ban on trade of dual-use sensitive defense technologies with Russia

Sources: Reuters and multiple news reports

The European Union said it also is targeting eight assitional individuals with sanctions, including three men it identified as close associates of Russian President Vladimir Putin. The EU described one of those sanctioned, Arkady Rotenberg, as Putin's former judo sparring partner and owner of companies that won lucrative contracts at the Sochi Winter Olympics.

German Vice Chancellor Sigmar Gabriel, along with economic analysts, said the sanctions will soon impact the Russian economy.

"I think they will very quickly show an effect, because the Russian economy is not in a good shape and of course those who are affected by [the sanctions], the Russian oligarchs, won't want their opportunities to move, and their investment of money freely in Europe, to be limited," said Gabriel.

The U.S. and the EU are protesting Russia's annexation of Ukraine's Crimean peninsula, its alleged support of pro-Russian separatists fighting against Kyiv in eastern Ukraine and its suspected role in the downing of a Malaysian passenger jet, which killed all 298 people aboard.

Western officials say the plane was struck with a Russian-made missile likely fired by rebels who mistakenly thought they were targeting a Ukrainian military aircraft.

The International Monetary Fund has slashed its 2014 economic growth forecast for Russia to nearly zero, down from 1.3 percent last year.

One key Russian lawmaker, Alexei Pushkov, said that with the sanctions, President Barack Obama will go down in history as a U.S. president who started a new Cold War.  The American leader earlier denied such contentions, saying the sanctions are aimed specifically as a response to Russia's actions in Ukraine.

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