The United States introduced additional, long-promised sectoral sanctions against Russia in connection with the situation in Ukraine. The move was first announced by the U.S. Treasury; President Obama then made a separate statement. Afterwards, the European side released the final statement of the summit of 28 EU countries with regard to Russia and Ukraine.
The U.S. sanctions list included several citizens as well as companies and organizations from Russia and Ukraine. The list includes State Duma Deputy Speaker Sergei Neverov, Minister for the Crimea Oleg Savelyev, presidential aide Igor Shchegolev, FSB Colonel-General Sergei Beseda, one of the leaders of the self-proclaimed People's Republic of Donetsk Alexander Boroday.
The list of companies and organizations includes Vnesheconombank, Gazprombank, companies Rosneft, Basalt, Feodosia Oil Company, Electronic Technologies Concern KRET, Constellation, NPO of Engineering, Almaz-Antey, Kalashnikov Concern, Instrument Design Bureau, Uralvagonzavod, JSC Novatek, as well as People's Republics of Donetsk and Luhansk, ITAR-TASS reports.
Officials with the Obama administration explained that the U.S. did not freeze the assets of Gazprombank and Vnesheconombank, but limited their access to the American market. Similar measures were taken against Rosneft and Novatek. White House officials said that these were very serious steps.
According to the statement from the U.S. Treasury, the new sanctions deprive Vnesheconombank, Gazprombank, Rosneft and Novatek from access to new financing. In other words, the sanctioned banks and companies will not be able to receive bank loans in the U.S. At the same time, the companies and banks will be allowed to maintain business contacts with American partners and conduct other financial transactions.
Nevertheless, the USA introduced "blocking sanctions" against Russian defense companies. They envisage complete cessation of all contacts with the companies on the part of the U.S; their assets in U.S. banks will be frozen.
U.S. President Barack Obama warned that he was ready to further strengthen the pressure of sanctions on Russia if it does not take real steps to de-escalate the conflict in Ukraine. Obama called the new sanctions significant and purposeful, elaborated to inflict the most painful blow on the Russian Federation. At the same time, he said, the sanctions will not affect U.S. companies and business allies.
Obama said that the United States would like to solve the problem primarily through diplomatic channels, without the need to resort to sanctions. But in this case, the U.S. needs action, not just words from Russia, to see that the country is taking steps to ease the Ukrainian conflict, said the U.S. president.
In April of this year, the United States introduced sanctions against 17 Russian companies associated with Putin's inner circle. A month earlier, Obama declared members of Putin's inner circle persona non grata. The list of those people included businessmen Arkady and Boris Rotenberg, Gennady Timchenko, Yuri Kovalchuk and his bank "Russia".
In response to the U.S. move, Russian President Vladimir Putin stressed that sanctions against Russia take Russian-American relations to a dead end and contradict to strategic interests of the United States. Answering a question about the next portion of U.S. sanctions against Russia, Putin responded sarcastically: "You don't say so!"
"We have to see what kind of sanctions they are, to look into the problem quietly," Putin said. The Russian leader said that such measures as sanctions, "as a rule, have a boomerang effect." "Without a doubt, in this case, they drive Russian-American relations to a standstill, striking a very serious blow on them. And I am convinced that it goes to the detriment of national long-term strategic interests of the American state and the American people," said Putin.
"It is very unfortunate that our partners are going on this way, but we have not closed the doors for negotiations," Putin added. Putin expressed a hope that common sense and the desire to resolve all problems by peaceful, diplomatic means will prevail.
In particular, the Russian president noted that the sanctions against Russia harm American companies. "The measures being taken by the administration of the United States, in my opinion, are contrary to the national interests of the United States, - said Putin. - Large companies want to work in Russia, but, when facing certain restrictions, they will lose their competitiveness compared to other energy companies."
The Russian leader said that American companies were given an opportunity to work on the shelf of the Russian Federation. "Well, doesn't the U.S. administration want their companies to work there?" he said. "The U.S. authorities cause damage to their largest energy companies. And for what? For making one mistake, while insisting on another one?" Putin wondered. He believes that "this is at least an unprofessional approach." "Sooner or later, such methods of solving international problems will have to be changed, but the damage...to count the losses will be up to those who do it," said the Russian president.
The reaction from the Russian Foreign Ministry was immediate. "New U.S. sanctions against Russian individuals and legal entities is outrageous and unacceptable. It will only complicate the relations with the United States further and create an unfavorable background in international affairs," said Deputy Foreign Minister Sergei Ryabkov. According to him, the pretext for sanctions is "far-fetched and false."
Russian Deputy Foreign Minister stressed out that Moscow intends to take steps in response to new U.S. sanctions. "We condemn the politicians and bureaucrats who stand behind such actions, and we confirm the intention to take measures that will be received in Washington quite painfully and seriously. We are not looking up to short-term effects, nor are we going to copy the revolting methods of the U.S. administration. We do not succumb to provocations, and we act calmly," said Ryabkov.
Meanwhile, as a result of the EU summit that took place on July 16th in Brussels, EU leaders called for a peaceful resolution of the crisis in Ukraine and immediate ceasefire to create necessary conditions to support the peace plan of Ukrainian President Poroshenko. In this regard, the summit supported the quadripartite consultations between Russia, Ukraine, Germany and France and the Berlin Declaration from July 2.
The leaders of 28 EU countries called on Russia to "actively use its influence" on militia forces, which the summit referred to as "illegal armed groups" to de-escalate the situation and "ensure the cessation of the flow of arms and volunteers across the border."
Meanwhile, the EU summit entrusted the European Commission with expanding the black list for Russia and Ukraine before the end of July. The list will include Russian and Ukrainian organizations and individuals that "materially or financially supported the actions that undermined the territorial integrity of Ukraine, including Crimea's reunion with the Russian Federation.
The summit suspended the signing of new financing agreements by the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB). The summit also suspended a part of European programs for the assistance to the Russian Federation. The volume of all those programs financed from the EU budget before 2020 is worth 447 million euros.
In addition, the summited requested the European Commission and the EU foreign service to prepare a proposal to block foreign investment in the Crimea.
Earlier, a diplomatic source said that the summit of 28 countries of the EU coordinated new sanctions against the Russian Federation, but did not accept the sectoral trade and economic restrictions. "An agreement was reached to suspend the launch of new projects by the EBRD and the EIB. No decisions were taken on sectoral economic sanctions," said the source.
According to ITAR-TASS, the European Union implements the strategy not to recognize the incorporation of the Crimean Peninsula into the Russian Federation. Within the scope of the program, the European Union banned exports of Crimean products to Europe in June and intends to increase prohibitive measures for investment, transport, visa policy, etc.
All these measures were developed by the European Commission and the EU's foreign service in May. They are a part of the so-called "soft block" of sanctions that may be introduced against Russia instead of full-fledged economic and trade restrictions aimed at sectors of the Russian economy.
The results of the EU summit on Russia reflect differences in the positions between the EU and the U.S., as well as the struggle within the EU, Russia's permanent representative to the EU Vladimir Chizhov believes.
"One should not dramatize the results of the summit. They reflect the existence of certain differences between the EU and the U.S.," he said by telephone from Brussels, Interfax reports.
"What the Americans have done without waiting for the results of the European summit is also symptomatic." "I guess they gave up on European allies, because until now the Washington line was to ensure maximum coordination of actions with the EU," the diplomat said.
According to Chizhov, Russian diplomats will work on the balance of power in the EU to maintain a reasonable approach to Russia. "We will not be able to convince everyone, but it is our objective to ensure the balance of power in favor of the voices of reason," he said.