White House

Following Crimea Annexation, U.S. Pushes Economic Sanctions on Russia

The president signed a new executive order on Thursday that targets more Russian leaders and sectors of the economy.

A Russian soldier stands in front of a recruitment poster for the Ukrainian armed forces in an area surrounding the Ukrainian military unit in Perevalnoye, outside Simferopol, on March 20, 2014.
National Journal
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Brian Resnick and Matt Vasilogambros
March 20, 2014, 7:23 a.m.

Pres­id­ent Obama took new steps Thursday to in­tensi­fy the eco­nom­ic isol­a­tion of Rus­sia fol­low­ing its “il­leg­al” an­nex­a­tion of Crimea, which could have a “sig­ni­fic­ant im­pact on the Rus­si­an eco­nomy,” the pres­id­ent said.

Speak­ing from the White House on Thursday, Obama said the U.S. will move “to im­pose sanc­tions not just on in­di­vidu­als but on key sec­tors of the Rus­si­an eco­nomy.” Seni­or White House of­fi­cials say the sanc­tions will ap­ply to 20 seni­or mem­bers of the Rus­si­an gov­ern­ment and oth­er “cronies.” They will also ap­ply to St. Peters­burg-based Rossiya Bank, which will be “frozen out of the dol­lar,” mak­ing it dif­fi­cult for the in­sti­tu­tion to op­er­ate in­ter­na­tion­ally.

The sanc­tions will tar­get Rus­sia’s fin­an­cial ser­vices, en­ergy, min­ing, and en­gin­eer­ing sec­tors, of­fi­cials said Thursday.

“This is not our pre­ferred op­tion,” Obama said, be­cause the ef­fects of such sanc­tions could trickle in­to the glob­al eco­nomy. European na­tions de­pend heav­ily on Rus­si­an crude oil and nat­ur­al gas ex­ports. 

Still, Obama said, “dip­lomacy between the United States and Rus­sia con­tin­ues,” des­pite these latest moves. Sec­ret­ary of State John Kerry met Monday with his Rus­si­an coun­ter­part, For­eign Min­is­ter Sergei Lav­rov in Lon­don, al­though the lead­ers re­por­ted no pro­gress.

Earli­er Thursday, the Rus­si­an Duma voted to ap­prove Putin’s an­nex­a­tion treaty. Only one le­gis­lat­or op­posed the meas­ure. On Fri­day, it will move to the up­per house of the Rus­si­an par­lia­ment, where it is ex­pec­ted to pass. Kiev con­tin­ues to protest the an­nex­a­tion, “Crimea was, is, and will be part of Ukraine,” the Ukrain­i­an par­lia­ment de­clared in a pub­lic state­ment.

While Obama re­it­er­ated his view that Rus­sia’s an­nex­a­tion of Crimea is il­leg­al, his re­marks sug­gest there’s not much the West can do about restor­ing the re­gion to Ukraine. And Ukraine agrees: the Kiev lead­er­ship said Wed­nes­day that it would pull its troops from Crimea, ef­fect­ively giv­ing up the re­gion and its mil­it­ary struc­tures to Rus­si­an forces.

Putin main­tains he has no in­ten­tions of in­vad­ing an­oth­er coun­try with large eth­nic Rus­si­an pop­u­la­tions. Parts of Ukraine and Po­land, as well as Balt­ic na­tions such as Latvia, Lithuania, and Es­to­nia, re­main con­cerned, however.

“The world is watch­ing with grave con­cern as Rus­sia has po­si­tioned its mil­it­ary in a way that could lead to fur­ther in­cur­sions in­to south­ern and east­ern Ukraine,” Obama said Thursday. Vice Pres­id­ent Joe Biden is cur­rently on on a whirl­wind tour of the re­gion, re­as­sur­ing those coun­tries of Amer­ica’s com­mit­ment to col­lect­ive de­fense un­der the North At­lantic Treaty Or­gan­iz­a­tion.

The Obama ad­min­is­tra­tion’s op­tions to con­front Putin have so far been lim­ited. The U.S. has already can­celed pre­par­a­tions for a sum­mer­time G-8 sum­mit in So­chi that would have in­cluded Rus­sia, hal­ted all mil­it­ary-to-mil­it­ary en­gage­ments with the coun­try, and im­posed travel re­stric­tions on sev­er­al Rus­si­an of­fi­cials. Obama has in­vited mem­bers of the G-8, minus Rus­sia, to meet in Europe next week to dis­cuss fur­ther re­sponse to Rus­sia’s in­volve­ment in Ukraine, and to re­con­sider Mo­scow’s mem­ber­ship in the or­gan­iz­a­tion. Whatever’s com­ing next for Rus­sia, it in­volves more isol­a­tion from the rest of the world.

Contributions by Marina Koren

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