Washington Sanctions Russian Banks, Sovereign Debt and Elites

After Russian President Vladimir Putin recognized the independence of eastern Ukraine’s breakaways republics and ordered troops to move there, the US announced a new batch of sanctions targeting the Russian government’s financing from the West and elites who benefit from it.

In remarks from the White House Tuesday afternoon, President Biden has called Putin’s moves the beginning of a Russian invasion of Ukraine and pointed out the sanctions against Kremlin will continue to escalate if Russia escalates.

Biden explained that the latest sanctions target two major Russian banks and Russia’s sovereign debt, meaning Kremlin can no longer raise money from the West and trade new debt on US or European markets.

Next in line for the first tranche of punitive measures, as Biden said, are Russian elites and their family members, including Denis Bortnikov, the son of Russia’s Federal Security Service head, the CEO of VK Group Vladimir Kiriyenko, and his father Sergei, Putin’s first deputy chief of staff, and the head of state-backed PSB bank, Petr Fradkov.

He added that the US would go far beyond the steps it took in response to Russia’s invasion of Crimea in 2014.

The US President said that, in the meantime, Washington will also continue to provide defensive assistance to Ukraine and will transfer about 800 infantry troops based in Italy and equipment already stationed in Europe to strengthen Estonia, Latvia, and Lithuania, but made clear that they have no intention of fighting Russia.

Biden also underscored that his administration will do everything it can to mitigate the effects that are likely to stem from sanctions on energy prices on American businesses and consumers.

The latest batch of measures expand the sanctions the US leveled against Russia in 2014, prohibiting new American investment and financial and property transactions in Donbas, as determined by the Treasury Department, as well as imports and exports from the regions.

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