WASHINGTON: The US announced new sanctions on Russia Wednesday that punish President Vladimir Putin’s government for the March 4 nerve-agent attack on former double agent Sergei Skripal and his daughter in the UK.
The planned moves, welcomed by the UK, added pressure on the ruble, pushing the currency to its lowest level since November 2016. The ruble and prices on Russian government bonds began dropping earlier Wednesday amid growing fears among investors about a separate bill proposed by US lawmakers that seeks “crushing sanctions” for election interference.
“It is clear that major sanctions actions are looming against Russia now either by the Administration, by Congress or both,” Tim Ash, a senior emerging-market strategist at Bluebay Asset Management LLC in London, said. “All bets are off.”
The latest restrictions are required under the 1991 Chemical and Biological Weapons Control and Warfare Elimination Act, which mandates punishment of countries that use chemical weapons in violation of international law. State Department officials said they expect them to take effect August 22.
These restrictions may be followed by a round of more sweeping penalties later this year, the officials said.
The sanctions taking effect this month will limit exports to Russia of US goods and technology considered sensitive on national security grounds, according to a State Department official who briefed reporters on condition of anonymity. The official said the action could block hundreds of millions of dollars in exports. Waivers will be allowed for space-flight activities and US foreign assistance.
Russia’s initial response was defiant, with Konstantin Kosachyov, chairman of the international affairs committee in the upper house of parliament, saying imposition of the new limits would amount to “the behaviour of a police state,” Interfax reported.
Under the US 1991 law – invoked previously only against North Korea and Syria – a second, far more extensive round of sanctions would follow later unless Russia meets conditions including providing assurances it will no longer use chemical or biological weapons and will allow on-site inspections to verify it has stopped doing so, the official said. Russia has repeatedly denied having or using the weapons.
The additional sanctions also could be averted if President Donald Trump declared that waiving them would be in the US national interest, a politically risky move in light of criticism that he’s been too soft on Russia on issues including interference in the 2016 presidential campaign.
The added sanctions could include a downgrading in diplomatic relations, blanket bans on the import of Russian oil and exports of “all other goods and technology” aside from agricultural products, as well as limits on loans from US banks. The US also would have to suspend aviation agreements and oppose any multilateral development bank assistance.
Russia has denied any role in the attack in the English city of Salisbury and rejects allegations it violated chemical-weapons restrictions. In March, the US expelled 60 Russian diplomats as part of a joint response with allies to the nerve-agent attack. Russia responded by ordering an equal number of US envoys to leave.
“The UK welcomes this further action by our US allies,” Prime Minister Theresa May’s office said in a statement Wednesday. “The strong international response to the use of a chemical weapon on the streets of Salisbury sends an unequivocal message to Russia that its provocative, reckless behaviour will not go unchallenged.”
The sanctions will be a boost for May, who’s counting on close ties with the US after Britain’s scheduled departure from the European Union in March.
The premier has had an often fraught relationship with Trump, with the two clashing over issues including his retweeting propaganda from a far-right British anti-Muslim group, intelligence leaks about last year’s Manchester terrorist attack and his criticisms of May’s Brexit plans on the eve of a visit to the UK last month.
While Skripal and his daughter survived the attack attributed to the Russian nerve agent Novichok, a British woman died and her companion became gravely ill after coming in contact with the substance just miles from the site of the March attack.
The new sanctions follow criticism of Trump for his refusal to call out Putin directly for transgressions including the interference in the 2016 election. Trump was criticised especially for playing down concerns about Russian meddling at his summit with Putin in Helsinki in July.
While Trump has cast doubt on US intelligence agencies’ finding that Russia interfered in the election and sought to help him win the presidency, his administration has repeatedly expanded US sanctions on Russia even as top officials have reaffirmed the findings on Russian election interference.
The State Department official said the administration’s approach is consistent – taking a tough approach to Russia’s aggressive actions while remaining committed to maintaining relations where possible.