On February 24, 2023, the US Government alongside G-7 leaders announced via a White House statement a new set of trade and economic measures targeting Russia and Belarus, as well as new economic and military support for Ukraine.
After prolonged internal wrangling, the EU also managed to adopt its own so-called tenth sanctions package perilously close to midnight on the same day.
Most of the hard work in establishing the worldwide Russia sanctions regime was completed by mid-2022. Accordingly, it is difficult to characterize the West’s latest sanctions as anything more than aggressive fine-tuning and a deepening of existing sanctions in key industrial sectors, but there is a new focus on blocking sanctions evasion, which as in any global sanctions campaign, expands into every available non-sanctions-enforcing territory, regulatory loophole and legal gray area.
US measures largely plugging newly identified gaps
G-7 leaders announced the establishment of an Enforcement Coordination Mechanism for the sanctions, which will be chaired by the United States in the first year.
The US Treasury Department’s new measures will add 22 Russian, Belarusian and third-country individuals and 83 entities to the list of Specially Designated Nationals, adding to more than 2,500 similar designations imposed over the past year. It also clarified rules on wind-downs of certain business activities for companies exiting Russia.
The State Department’s new sanctions include travel bans and asset freezes on additional Russian cabinet ministers, economic bureaucrats and dozens of governors and regional chiefs. Some have been specifically named for human rights violations in Ukraine, while most are listed for their key roles in supporting the Russian war effort.
Increased American tariffs will also be levied on more than 100 Russian metals, minerals and chemical products generating about $2.8 billion in revenue for Russia, some of which have run afoul of anti-dumping regulations.
Export controls are also being tightened on a range of luxury consumer goods still going to Russia, among other items, as well as certain US-origin electronic components that have been identified in Iranian drones that have been used against Ukraine.
Washington also announced its plans to send $250 million in aid to shore up Ukraine’s energy infrastructure in the face of Russian attacks. Next door Moldova will get $300 million to help wean itself from energy dependence on Russia.
Military aid to Ukraine is being boosted by another $2 billion according to official US announcements. The new aid is mostly in the form of high-tech equipment, specialized types of ammunition critical to the war effort as well as funding for “training, maintenance and sustainment” according to the Department of Defense.
Tenth EU package mostly fine-tuning
The delay in agreeing to the latest package was largely due to insistence by Poland that the new sanctions contain tougher measures. In this instance, Poland specifically resisted attempts to exempt large quantities of rubber from the new EU “ban” on imports from Russia, which brought it into sustained deadlock with Italy, a leading tire manufacturing country, supported by Germany. These kinds of disagreements have long been a problem within the EU, whereby one or two countries threaten to veto new sanctions that could disrupt their own economies unless given specific exemptions or extended deadlines.
The tenth round of EU sanctions, not seen by most observers as particularly tough, targets about 120 individuals and entities, including those involved in the abduction of Ukrainian children, those who spread disinformation, Iranians involved in sending drones to Russia, and members and supporters of the Wagner Group mercenaries, including its activities in Africa.
The new sanctions will also restrict EU exports of electronic components used in Russian weapons, including missiles, drones and helicopters, and bans some rare earth minerals, electronic circuits, construction equipment and thermal cameras.
Brussels’ new sanctions also prohibit transactions with three more Russian banks and lists 96 more entities, including seven from Iran that provides the Russian Federation with drones used in attacks against civilian infrastructure in Ukraine.
Two additional Russian media outlets have been added to the media ban, RT Arabic and Sputnik Arabic.
No significant new measures covering the energy sector were included in this package, as these were covered in the eight EU package adopted in October 2022 with key measures designed to ban most seaborne oil imports coming into force on December 5, 2022.
