WASHINGTON – The United States and its European allies hit more than two dozen Russian government officials, executives and companies with new sanctions Monday as punishment for their country’s actions in Ukraine, yet the penalties stopped short of targeting Russia’s broader economy and it remained unclear if they would work. In Moscow, there was relief that the sanctions were not as far-ranging as feared.
The measures, including asset freezes and visa bans, affect people close to the Kremlin, and Western leaders hope those hurt by the sanctions will pressure Russian President Vladimir Putin to limit his reach in Ukraine and de-escalate the crisis there. However, the Russian leader himself was not among those targeted, and Obama administration officials acknowledged there was no expectation that Putin would quickly change course.
Still, officials in Washington and Brussels said the sanctions, coupled with an initial set imposed following Russia’s annexation of the Crimean peninsula last month, would significantly boost the cost to Moscow of ignoring an agreement it signed earlier this month to take concrete steps to ease tensions in Ukraine.
“The goal here is not to go after Mr. Putin personally,” President Barack Obama told reporters in the Philippines, where he was wrapping up a four-nation trip to Asia. “The goal is to change his calculus with respect to how the current actions that he’s engaging in could have an adverse impact on the Russian economy over the long haul.”
Obama said Russia still could resolve the Ukraine crisis diplomatically.
In addition to the sanctions on the seven individuals and 17 companies, there also are new arms and technology export restrictions on Russia.
Meanwhile, in Brussels, the European Union announced it had added 15 more officials to its Russia sanctions list, bringing to 48 the number of people singled out for “undermining Ukraine’s territorial integrity, sovereignty and independence.”
They will be banned from traveling to the 28-nation bloc, and their assets will be frozen, the EU said in a statement.
The EU is Russia’s biggest trading partner, giving the Europeans greater economic leverage over Moscow than the U.S. has. However, the EU treads more carefully in imposing sanctions since Russia is also one of its biggest oil and gas suppliers – and the bloc apparently shied away from following Washington’s lead in targeting specific Russian companies.
In Moscow, the new sanctions were seen as milder than many had feared, largely because they did not affect any public companies or major sectors of the economy. The Russian RTS index jumped 1 percent on the news.
On Capitol Hill, lawmakers from both parties called on the administration to do more.
White House aides sought to highlight the impact the sanctions already imposed have had thus far.
Some $60 billion in capital flight so far this year exceeds last year’s total; the Russian ruble has depreciated nearly 9 percent against the U.S. dollar since the beginning of the year; investors are demanding higher risk premiums to hold Russia’s debt; the credit agency Standard & Poor’s cut Russia’s credit rating Friday for the first time in more than five years, and the Russian central bank recently downgraded the country’s 2014 growth projection to less than 1 percent, according to the officials.