U.S. and EU toughen sanctions on Russia

West shows his teeth. The EU agreed yesterday to toughen sanctions against Moscow for his role in the conflict in Ukraine, with strong action on the financial sector, energy and military. There was nothing like it since the end of the Cold War: to punch in the European table, which is after the downing of the plane of Malaysia Airlines precipitated almost 300 dead last night joined the U.S. that sanctioned three big banks, as Treasury announced.

While European leaders take vacations Vladimir Putin in Moscow remains: analysts predict a withering reaction from the Russian prime minister, which could lead to retaliation and ultimately end up in a worsening of the conflict in Ukraine and, especially, in a very dangerous trade war for the Russian economy – the – brink of recession but also for European.

The economic drain can do much damage for a long time: the EU imposes these sanctions for a year, but with a handful of exceptions aimed at tempering the response of the Kremlin. The revised package Veintiocho full within three months after assess their actual impact and to give options trading, a sealed road in a while. The great fear is that Putin shut off the gas, which rely almost 100% several Eastern European countries, and represented 30 % of the needs of Germany.

President Barack Obama waited to European decision to reveal its own new set of sanctions, which target the same sectors of the Russian economy as energy, defense and financial, with the extension of sanctions on three Russian banks: VTB, Bank of Moscow and the Agricultural Bank. “We are blocking the export of specific goods and technologies to the Russian energy sector, we are expanding our sanctions over Russian banks and defense companies, and are formally suspending credit to encourage exports to Russia and the financing of economic development projects in Russia “summarized Obama from the White House. Obama specified that complement U.S. sanctions European, calling it the ” most significant and extensive ” agreed so far, and said he will have a greater impact on the Russian economy.

The U.S. president also accused Moscow of ” isolated ” increasingly with support for separatists warned that Ukraine and Russia is thereby throwing away ” decades of genuine advance” in their integration into the international community. However, he rejected the new sanctions, less than two weeks after the last round, it constitutes a new Cold War.

The crisis of a thousand faces first – financial and economic, sovereign, social and political debt and after – acquired a geopolitical dimension that depend on the actual scope of the sanctions and the Russian reaction. The most significant are financial measures: the EU and the U.S. impose serious restrictions on Russian public banks, which can not be financed over 90 days, but leave out the perimeter of the disciplinary issues of public debt and instruments such as syndicated loans – loans from several banks at once, despite the British insistence that route also blind. Without funding in euros or dollars, problems are guaranteed. That leg of sanctions will very touched to the financial system and with it a big business, dependent on funding. The German intelligence services believe that the Russian oligarchs will soon claim a turn to Putin before the huge financial pressure ahead. Capital flight has been a constant since the beginning of the conflict in Ukraine, and may intensify.

Along with these measures, the EU imposes a hard arms embargo prohibiting trade of dual – use commercial products, but also military, and constraints on the use of new technology in new oil exploration projects. But left out in all these cases already signed to try to soften Russia’s reaction contracts. It also increases the list of persons and increasingly closer to the inner circle of Putin sanctioned companies. European firms with interests in Russia as British Petroleum and Renault yesterday warned of the potential consequences of those actions, which begin to be implemented later this week.

The sanctions are ” strong warning ” and ” an important signal ” to make clear to Putin that ” destabilize Ukraine or any other country in Eastern Europe have heavy costs to its economy,” warned the president of the European Council, Herman Van Rompuy, and of the Commission, José Manuel Barroso. The demolition of the MH17 flight that left 298 victims and an investigation is pending, also required ” urgent and determined response.”

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Posted by Maleeha Tareen on Jul 31 2014. Filed under Business, Latest News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.