U.S., EU Widen Sanctions On Russia - Global Trade Magazine
  September 13th, 2015 | Written by

U.S., EU Widen Sanctions On Russia

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  • 33 entities are cited in new Russia sanctions, including subsidiaries of state-owned oil giant headed by Putin crony.
  • The Russian Foreign Ministry called the new sanctions "hostile actions" and warned that Moscow would respond.
  • The IMF estimates that western sanctions reduced Russia's GDP by between one and 1.5 percent.

The United States and the European Union are once again widening sanctions against dozens of Russians and Ukrainian individuals and entities with connections to Crimea’s annexation and the ongoing violence in eastern Ukraine.

The Obama administration announced it was adding 29 people to its sanctions list.

Some of those added have ties to Kremlin-linked insiders and companies who were previously sanctioned, including Gennady Timchenko, a wealthy oil trader believed to be close to President Vladimir Putin.

A total of 33 companies or other entities were cited, including subsidiaries of state-owned oil giant Rosneft, headed by Putin ally Igor Sechin, and the company that manufactures Kalashnikov assault rifles. Crimea’s top ferry operator and several ports on the Black Sea peninsula, which was annexed by Russia in March 2014, were also blacklisted.

The sanctions are part of a continuing program seeking to influence Russia to reverse its annexation of Crimea and to stop supporting separatists in Ukraine.

Among other things, the sanctions, imposed by the Commerce Department, make it more difficult for U.S. companies to get export licenses for goods and materials destined to those individuals and entities.

The European Union said it would extend asset freezing and visa bans on 150 Russians and Ukrainian separatists, along with 37 companies and entities either located in Crimea or having ties to separatist units in eastern Ukraine.

The announcement expands the sanction list first imposed last year by the EU.

In Moscow, the Foreign Ministry called the new sanctions “hostile actions” by the United States against Russia. Moscow warned it would respond.

“The action of the United States devalues the signals that it is interested in cooperating with us in resolving myriad pressing international problems,” the ministry said in a statement. “The United States should have no illusions that it could continue this course without negative consequences for themselves. This reckless course is of growing concern even among U.S. allies. Retaliatory measures, while not necessarily reciprocal, will follow from our side.”

The crisis in Ukraine has sent relations between Moscow and the west to lows not seen since the fall of the Soviet Union.  But the efforts of Washington and Brussels to influence Moscow to reverse the annexation and stop its backing of separatist forces have produced questionable results. A report issued last month by the International Monetary Fund estimated that the western sanctions had reduced Russia’s gross domestic product by between one and 1.5 percent.