New U.S. sanctions could pitch Russia relations to new low

Published 8:29 am Monday, August 13, 2018

WASHINGTON — Russia typically brushes off new U.S. sanctions. Not this time.

The Trump administration announcement of export restrictions in response to accusations Moscow used a nerve agent to poison a former Russian spy in Britain sent the ruble tumbling to a two-year low and drew a stern warning from its prime minister. While the initial sanctions may have a limited impact, a second batch expected within months could hit the Russian economy much harder and send already tense relations into a tailspin.

If sanctions are expanded even further to target Russia’s top state-controlled banks, freezing their dollar transactions — as proposed under legislation introduced in the Senate this month — it would amount to a “declaration of economic war,” Russian Prime Minister Dmitry Medvedev said Friday.

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So much for President Donald Trump’s hopes for better relations with Moscow.

On his watch, the U.S. has imposed a slew of sanctions on Russia for human rights abuses, meddling in the U.S. election and Russian military aggression in Ukraine and Syria. For the most part, they have punished Russian officials and associates of President Vladimir Putin rather than targeting broad economic sectors.

In 2014, both the U.S. and European Union introduced sanctions that restricted Russia’s access to global financial markets and to equipment for new energy projects. Those measures were punishing, but the sanctions announced by the Trump administration this past week could be even worse.

The restrictions were triggered under U.S. law on chemical weapons following a formal U.S. determination that Russia used the Novichok nerve agent to poison former Russian spy Sergei Skripal and his daughter in the English city of Salisbury in March.

The first tranche, due to take effect Aug. 22, will deny export licenses to Russia for the purchase of many items with national security implications. Existing sanctions already prohibit the export of most military and security-related items, but now the ban will be extended to goods such as gas turbine engines, electronics and calibration equipment that were previously allowed on a case-by-case basis.