The EU to bear the cost of eventual sanctions against Russia

Catherine Ashton, High Representative of the EU for Foreign Affairs and Security Policy, speaking to the Press while heading for the Extraordinary Foreign Affairs Council which took place in Brussels, on 3 March 2014. (The Council of the European Union photographic library).

Catherine Ashton, High Representative of the EU for Foreign Affairs and Security Policy, speaking to the Press while heading for the Extraordinary Foreign Affairs Council which took place in Brussels, on 3 March 2014. (The Council of the European Union photographic library).

It’s easy for Washington and London to threaten Russia with far reaching economic sanctions, but very many countries and businesses in continental Europe don’t see it that way. The US and Britain after having actively supported the ‘Kiev revolution’ which ousted Victor Yanukovych from the Presidency, now insist that the West imposes tough economic measures on Russia for invading Crimea. Of course, the cost of the sanctions will be borne by those who can impose the measures that is continental Europe.

During the eleven month period of January-November 2013 the EU exported to Russia a wealth of goods of €111.6 billion and imported goods of a value of €189.6bn. Russia is the third trading partner. When it comes to energy dependencies, Russia covers around one third of continental Europe’s needs in natural gas. There are EU countries which depend almost entirely on Russian natural gas. The EU is Russia‘s largest trading partner by far, with 45% of all Russian external trade, and Russia is the EU’s third most-important trading partner, after the US and China. No need then to dig in intelligence reports to discover that continental Europe is lukewarm if not reluctant about imposing economic sanctions on Russia.

The high cost of sanctions

There is a lot more to it though. European financial markets have already felt the heat from the Ukrainian crisis. If the Kiev-Moscow standoff becomes uncontrollable, Europe will pay a dear price in many respects, let alone if this crisis leads to an EU – Russia impasse. For all those reasons, the EU had brokered a deal between the ousted President Yanukovych with the Ukrainian opposition. The pact was signed on Friday 21 February only to become a worthless paper the next day.

On 24 February the European Sting noted, “On Saturday, only hours after the agreement between Victor Yanukovych and the Ukrainian opposition party leaders had been signed and endorsed and also signed by three European Union ministers of Foreign Affairs (German, French and Polish) representing the EU Foreign Council, the Ukrainian Parliament rendered this pact void. In direct violation of the aforementioned pact, the legislative voted Yanukovych out of his office and appointed as interim President the speaker of the house Oleksander Turchinov”.

Pay for Tymochenko’s restoration?

The new Kiev rulers are practically appointed, by the ‘regiments’ of protestors in control of the city’s central Independence Square. Most of them belong Julia to Tymochenko’s Fatherland political party. No need to mention who Tymochenco is and who and what she represents in today’s Ukrainian stalemate. Her direct relations with the West, mainly with Washington, are well known. She was mixed up to her neck in the corrupt swamp of government-business relations, when she ruled the country as prime minister, under President Yushchenko in the aftermath of the ‘Orange Revolution’. She was then given the nickname of ‘gas princess’ after a lucrative agreement with the Russian natural gas monopoly Gazprom. For all those reasons, she is quite unpopular in Ukraine but very popular in the Washington and Brussels corridors of power. That’s why she governs Kiev by proxies.

It’s really a joke that the Anglo-Americans now demand that the Europeans put their relations with Russia in jeopardy, just to restore Tymochenko’s grip on Ukraine. The fact that the EU brokered an agreement between Yanukovych and the then opposition was trampled within 24 hours is very indicative of what happened in Kiev. The three EU countries who helped for this agreement to be concluded are Germany, France and Poland. Any major disorder in central Europe will primarily hurt those three economies and then the entire continent, while the Anglo-Americans have nothing to lose.

Given that nobody in the West talks seriously about a military intervention in Ukraine to stop Russia’s direct involvement, then it will be economic sanctions against Moscow. Unfortunately, the cost will be borne exclusively by continental Europe, at a time when the EU is struggling to restore its economy and rebalance the financial sector.

 

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

Stopping antimicrobial resistance would cost just USD 2 per person a year

OECD economic scenarios to 2060 illustrate the long-run benefits of structural reforms

Cybersecurity needs a holistic approach. Here are three ways to build protection

UN forum to bring ‘big space data’ benefits to disaster response in Africa

Schengen is losing ground fast revealing Europe’s clear inability to deal with migration crisis

Reception conditions for asylum-seekers agreed between MEPs and Council

Zuckerberg, a paella, and the mighty EU questionnaires that would stop Whatsapp acquisition by Facebook?

How India will consume in 2030: 10 mega trends

Bankers don’t go to jail because they are more equal than us all

US – Russia bargain on Syria, Ukraine but EU kept out

Mobile 360 Series – Russia & CIS: Empowering the Digital Economy

Action needed to end deadly clashes between African herders and farmers: UN chief

The time for cities to get smart is now

The missiles fired against Damascus, Syria divided Europe deeply

Youth Internationalization: part of everyday life in JADE

Germany to help China in trade disputes with Brussels

Germany is the world’s most innovative economy

4 steps towards wiping out cervical cancer

UN chief ‘following very closely’ reports of chemical weapons use in Syria’s Aleppo

5 ways blockchain can transform the world of impact investing

We could be sleepwalking into a new crisis. How should the business world prepare?

Donald Trump’s victory is a great opening for global EU leadership on the sustainability agenda

UN calls for support to implement Central Africa’s newly minted peace agreement

German opposition win in Lower Saxony felt all over Europe

Germany loses leading export place

EU agricultural production no more a self-sufficiency anchor

MEPs back plans to halt spread of drug resistance from animals to humans

Superbugs: MEPs advocate further measures to curb use of antimicrobials

Britain heading to national schism on exit from EU

Vaccine hesitancy: a pregnancy related issue?

EU deal on electricity market rules to benefit both consumers and environment

FROM THE FIELD: South Sudan’s green shoots, highlight environmental recovery from war

ECB: Growth measures even before the German elections

More women than ever before are running for political office in the US

The European Union’s Balkan Double Standard

The “Legend of the Sun” wishes you Happy Chinese New Year 2015 from Brussels

Social entrepreneurs can change the world – but these 6 things are holding us back

Migration crisis update: Greece could probably say goodbye to Schengen really soon

Innovation is the key to the pay-TV industry’s long-term growth

Bureaucracy in the member states again the obstacle for long due strong European Hedge Funds

EU car manufacturers worry about an FTA with Japan

Why Eurozone needs a bit more inflation

Chart of the day: These are the cities where the World Cup threatens productivity the most

Crimea, a wicked game of political chess and a ‘big’ coincidence

Art has the power to change the world, says this renowned Iranian muralist

Infinite Oath

G7 summit: Trump Vs. G6 leaders on trade and climate change

Who really cares about the 26.2 million of EU jobless?

Euro celebrates its 20th birthday

World cannot be transformed without ‘ingenuity of the countries of the South’: UN Chief

Making the most of the Sustainable Development Goal 3: its overlooked role in medical education

ECB reaches the boundaries of its mandate to revive the entirety of Eurozone

South Sudan’s women caught up in ‘futile man’s war’ UN gender equality chief

Japan initiates WTO dispute complaint against Korean duties on steel

Fear casts again a cold, ugly shadow over Europe; Turkey sides with Russia

Is there a drug for every disease?

A Sting Exclusive: “Climate change-the biggest global health threat of the 21st century, yet overlooked in climate negotiations?” IFMSA wonders from COP21 in Paris

Parliament backs a modernised EU electoral law

Bitpay @ TheNextWeb 2014: Innovation’s Best Friend

Basel III rules relaxed: Banks got it all but become more prone to crisis

What will it take for the world’s third-largest economy to empower women?

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s