It seems that after the US Congress passed a bill on strengthening sanctions against Russia, on July 27, the tensions in the two nations’ relations will only increase. An indication of this was the reaction of the Russian authorities to the passage of this bill, and in particular Russian President Vladimir Putin announcing that 755 US diplomats should leave Russia.
Let us recall that the Russian section of the bill, which was passed by the US Congress and is called “H.R.3364 Countering America’s Adversaries Through Sanctions Act,” has three main objectives: firstly, to enshrine in legislation President Barack Obama’s four executive orders issued in 2014 and directed against so-called separatists in Ukraine and those who support their activities, Viktor Yanukovych’s officials and people from Putin’s inner circle. These orders also limit US investments into the Russian financial sector, defense technologies, and energy.
The second objective is to extend existing sanctions by obliging the president rather than simply empowering him to impose strengthened sanctions which would limit raising debt finance for the energy and financial sectors as well as oil production, limit the ability of state-owned Russian enterprises to attract financing through privatization or investing deals amounting to 10 million dollars or more.
The third objective is to impose new sanctions related to cyber interference and human rights violations by the Russian Federation, as well as sanctions related to high-profile corruption in Russia.
John HERBST, Director, Dinu Patriciu Eurasia Center, Atlantic Council, Washington, D.C.:
“The sanctions legislation passed by Congress is a serious blow to the Kremlin. Since Trump emerged as the likely Republican nominee late in the spring of 2016 until early into the Trump Administration, Moscow was hoping that President Trump would remove the sanctions established in late 2014 and regularly renewed since. Trump was clearly considering this in his first weeks in office.
“Instead, because Congress does not trust the President’s instincts on the Kremlin, this legislation was passed. The IMF said that in 2015, sanctions cost Russia 1-1.25 percent of GDP. Kudrin was recently quoted to the effect that the existing sanctions would cost Russia 5 percent in GDP now. The new sanctions will add to the cost. But our new sanctions make Mr. Putin’s life more difficult. They are an important step in strengthening US policy against a revisionist Moscow.”
Lilia SHEVTSOVA, a Russian journalist, Moscow:
“First of all, let us assess what the not-yet-signed by Donald Trump package of US sanctions against Russia means. This package actually throws Russia out of the circle of normal international actors right into the ghetto, as it puts Russia on the list of rogue states on a par with Iran and North Korea. Yes, this is just a collective assessment of the role of Russia by the American establishment so far. But we are talking about the attitude of the world leader and the locomotive of international relations. And this attitude will undoubtedly influence the position of the international community. In addition, the sanctions limit Russia’s participation in the process of globalization, bringing Russia closer to exclusion from the world financial system and removing it from the global capital and technology markets. This is a powerful blow to the Russian economy and the future of the country.
“Against this background, President Vladimir Putin’s reaction looks more than vague, weak, and inadequate. You see, Russia evicts 755 American diplomats and takes away a house and a warehouse (!) rented by the US embassy! Well, it is unpleasant and a headache for Americans. Still, this is not serious! This is a mosquito bite, which the elephant will not feel! By the way, I advise those who are interested in the story to watch Putin’s interview with the VGTRK TV channel, hosted by Vladimir Solovyov. It offers a fascinating picture. Putin looks surprisingly confused, gloomy, absent-minded, and completely unintelligible. However, he is far from being aggressive, despite what one could assume. After all, the rest of Russian politicians and commentators spent a week deliberately playing the part of a bulldog pack who stood ready to tear America into bits. But not Putin... No... He was an embodiment of peacefullness and tranquility. Yes, he accused the Americans of ‘rudeness.’ That was all. He gently warned that Russia had ‘other answers.’ But all he said showed that there were actually no such answers. Unless the Kremlin is going to shoot Russia in the foot and ‘bomb Voronezh’ as it is wont to do, with its response measures directed against its own citizens. So, here is the conclusion: Russia does not know how to respond to the American challenge.
“This does not mean that the Kremlin will not come up with another stupid thing that will cause the US to hit back and plunge the world into a situation of a new nuclear confrontation. But so far, the Kremlin does not want to escalate things. It is trying to avoid it. It is obvious. Putin himself understands that escalation will lead to Russia losing its most important survival resource, I mean the West’s largesse.
“What is next? Events unfold like in Alfred Hitchcock’s films. The state of the imminent threat continues to dominate the international situation. But this time its source is not only in the Kremlin. President Trump, too, shakes the world order, undermines America’s international leadership. And the world without leadership begins to slide down into chaos...
“What will be the impact of the sanctions on Russia? It will be most catastrophic. They are capable of not only destroying the Russian energy industry, but also undermining other industries that need technology and funds by cutting off their sources of international financing. In a word, the sanctions become, as I call it, an ‘economic garrot,’ which is capable of slowly but inevitably strangling the Russian economy. And the Kremlin understands this perfectly.
“Can the sanctions become a gift for Putin? What gift? Will they give him an excuse for a bout of anti-American hysteria? But he can provoke it with the help of TV and without sanctions just as well. Although now people are not very inclined to engage in this kind of hysteria, as citizens are worried about the contents of their fridges more. So, I do not expect the Kremlin to really see in the sanctions something positive for itself.
“Will the sanctions force the Kremlin to leave the Donbas? Well, it is too early to talk about this. For now, Russia is still trying to understand what they mean, to what extent Europe will be able or unable to help Russia to avoid the ghetto, and to what extent the sanctions will be actually implemented, and not ignored. So far, I see no reason for a serious revision of Russia’s policy towards Ukraine. And this policy is as follows: to do everything possible to keep Ukraine in the sphere of its ‘interests,’ or, at least, complicate Ukraine’s efforts to strengthen its own statehood.
