The European Union is legally prepared to impose industry-wide sanctions against Russia, Swedish Foreign Minister Carl Bildt said at the Ukraine Crisis Media Center on May 16.
Sweden’s top diplomat said that at the May 12 EU foreign
ministers meeting in Brussels, a “legal framework was put into place that
didn’t exist before” for imposing sector-wide sanctions on Russia.
The EU has already sanctioned 61 Russians and Ukrainians,
two banks, one energy company and a Crimean port with an oil terminal over
Russia’s aggression toward Ukraine, starting with the annexation of Crimea and
now for the unrest in the nation’s two easternmost regions of Luhansk and
Donetsk.
However, the 28-nation economic union has been reluctant to
upgrade sanctions, which would disproportionately affect Russia’s economy but
also the EU’s. Last year EU-Russian bilateral trade was $461 billion.
Great Britain, France and Germany have been accused of not
wishing to take the next step for profit-motive reasons. At a conference in
Bratislava, Slovak Prime Minister Robert Fico pointed to the bloc’s west for
resisting the measures and said it was “hypocritical” of them to conduct
business with Russia while threatening it with more sanctions.
This week, for example, the French government signaled that
it would move forward with the sale of two Mistral class warships to Russia
worth $1.6 billion. Meanwhile, German corporate executives at Siemens, Adidas,
Volkswagen, as well as other companies opposed more severe economic sanctions
on Russia.
Their opposition though differ with what the general
director of the Federation of German Industries said in a May 7 op-ed in the
Financial Times. Markus Kerber argued that it is German industry’s
“responsibility to try to help end” the crisis in Ukraine, even if that cuts
into corporate profits.
Bildt wouldn’t say what Russia would have to do for sectors
like energy, banking and other interests to be targeted.
“We are vague for a specific reason, Russia shouldn’t be
certain (with what it could get away),” added Sweden’s foreign minister.
Cited by Bloomberg, Slovak Prime Minister Fico said: “We are
prepared to show solidarity, be united players even if it costs Slovakia
something. But I want to see solidarity everywhere in Europe, so that it’s not
only member states bordering Ukraine (like Slovakia) that will show it.”
Capital
flight from Russia since the Ukraine crisis erupted has reached $222 billion, European Central Bank president Mario Draghi said on May 8, cited by The Telegraph.
“We had
very significant outflows that have been estimated by some to be in the order
of €160 billion out of Russia,” he said, without specifying where the information
came from. The Russian finance ministry, however, said outflows had been just
$51 billion in the first quarter, though the total has almost certainly risen since
then, reported The Telegraph.
Kyiv Post editor Mark
Rachkevych can be reached at [email protected].
