As Washington seeks to further squeeze Russia’s economy, Deputy Treasury Secretary Wally Adeyemo said Saturday that Washington will directly warn companies against evading US-imposed sanctions on Russia over the war in Ukraine.
Citing specific concerns about the United Arab Emirates, Iran, Turkey, and countries near Russia evading sanctions, Adeyemo noted, speaking ahead of the first anniversary of Russia’s invasion of Ukraine on February 24, that the US will go directly to their companies.
Washington plans to make very clear to those companies that they can choose to either do things that benefit Russia and provide it with material support, or risk losing access to the economies of Europe, the United States, and the UK economy.
Focusing on cracking down on facilitators and third-country providers helping Russia evade Western sanctions, the US Treasury’s sanctions official, Brian Nelson, traveled at the end of January to Turkey and the UAE to warn them that if they do business with entities subject to US curbs, they could lose access to G7 markets.
Following the invasion of Ukraine, Russia, Russian President Vladimir Putin, its financial sector, and oligarchs faced sanctions imposed by the United States and its allies, including the European Union and the United Kingdom, that have since continued to ratchet up the pressure.
Adeyemo stressed that within the crackdown on sanctions evasion, Washington will use sanctions, export controls, and other tools heavily focused on manufactured goods, dual-use items – which have both commercial and military applications- and construction.
He added that the Biden administration also plans to reach out to banks in the US, Britain, Europe, and Japan to warn their clients that, if found to be evading US sanctions, they could lose access to financial institutions.
Adeyemo’s comments come after IMF’s forecast last month that – after shrinking by 2.2% in 2022 – the Russian economy would expand by 0.3% in 2023 in a sign that it was not hit as heavily as initially expected by western sanctions.
The International Monetary Fund’s initial forecast for the Russian economy in April was a decline of 8.5% in 2022 and a further contraction of 2.3% in 2023.