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US has ‘long playbook’ of further Russia sanctions, says senior official

The US has a “long playbook” of further sanctions planned against Russia and sees little scope for lifting existing ones, according to a senior state department official.

Jose Fernandez, US under-secretary for economic growth, energy and the environment, said the US was working with Europe on additional punitive measures against Moscow, especially as the EU had warmed to the idea of further restrictions on Russian energy imports.

“From day one everything is on the table . . . on sanctions, on oil, we have a long playbook. And in that playbook, several pages have not been read out,” Fernandez told the Financial Times.

“At the end of the day, the goal continues to be maximising the pain, the consequences on Russia and minimising the consequences on the US.”

Fernandez said the US was working closely with the EU to help it reduce Europe’s dependency on Russian energy, as European governments consider whether to impose sanctions on the Russian energy sector.

“We are largely self-sufficient in energy. That’s not the case in Europe, but at the same time, they’ve understood that they’ve got to start taking steps,” Fernandez said. “I think they are clear that they are going to continue and in fact intensify investments in renewable energy.”

Fernandez said it would be up to Ukraine to decide whether an easing of western sanctions should be part of any peace deal negotiated with Moscow.

“Ukraine has paid a high price and earned the right to decide its sovereignty,” he said.

However, Fernandez added that he did not foresee the sanctions being eased barring a dramatic change in the situation in Ukraine.

“Our sanctions, they have always been imposed with the understanding that these are sanctions that if needed can be taken back. [But] it is hard to see — given the actions and given the atrocities that we continue to hear about, read about and see every day — it is hard to see an easy off-ramp to this other than Putin stopping this war of choice,” Fernandez said.

Sanctions experts said the Biden administration’s measures against Russia marked a departure from previous US government policy.

“The treasury department’s longstanding view is that sanctions are not punitive . . . They are supposed to be coercive,” said one former treasury sanctions official.

That had changed followed Russia’s invasion of Ukraine, he said, where some Russian institutions were being punished just for being part of the Russian economy, with no clear path for a change in behaviour that would allow those sanctions to be lifted.

“You can use [sanctions] punitively, but then you undermine their ability to succeed going forward,” the former official added.

Daniel Fried, a former US diplomat who ran Russian sanctions policy in the administration of Barack Obama and now works at the Atlantic Council, said there were two prevailing opinions on the shelf life of Russian sanctions.

“If there was a peace deal at hand, sanctions relief would certainly be part of the package,” he said. “[But] there’s another school of thought that says no, no, no, you have to keep on the sanctions as long as Putin is in power because otherwise he’ll commit aggression again.”

While he had sympathy for the latter argument, it was not tenable in terms of actually reaching a peace agreement, he said.

“Consider the position we would be in if there was an otherwise acceptable deal and sanctions relief has to be part of it. Are you really going to then let the deal fall through if the Ukrainians wanted it?” Fried said.

Fernandez said that the US believed the current sanctions had been effective in crippling the Russian economy.

While the rouble has recovered much of its initial losses against the dollar because of intervention by the Russian central bank, US officials have pointed to other economic indicators as evidence of the long-term pain that Russia will suffer.

“We’ve seen 600-plus companies leave Russia. We’ve seen reports that their inflation rate is in the 15 to 20 per cent [range]. We’ve seen Standard & Poor’s lower their rating to junk,” Fernandez said.

“These things take time. And we have to continue to ratchet up the pressure.”


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