EU faces challenges as threat of Russian sanctions looms

Written by on June 29, 2014 in Europe - Comments Off on EU faces challenges as threat of Russian sanctions looms

Washington warned Russia Friday that it could impose new sanctions if Moscow does not do more to defuse the conflict in eastern Ukraine. The Obama administration said it has delayed implementation as it presses for unified support from European and U.S. manufacturers for the measures.

Meanwhile, at a Brussels summit, EU leaders set a Monday deadline for Putin to demonstrate support for calming the unrest in Ukraine.

In a statement issued Friday, the 28 leaders called for Moscow to meet several conditions, including visibly supporting the Ukrainian government’s proposed peace plan. Ukraine’s government also should be granted oversight of three major border checkpoints, according to the statement.

Two other terms include setting up a means of verifying the cease-fire and securing the release of all captives, the French news agency AFP reported. If Putin fails to meet those conditions, Russia could face “further significant restrictive measures,” the statement said.

Analysts say the threat of sanctions is putting the European Union in an awkward position. The 28-nation bloc hopes to avoid a broader economic clash with Moscow that would hurt their own businesses.

Germany-Russia relationship

German Chancellor Angela Merkel reportedly has warned Putin that the EU will consider a new round of sanctions against Moscow if it doesn’t cooperate.

The relationship between Russia and Germany involves deep business ties. With a heavy dependence on Russian oil and gas and extensive business interests in the country, Germany is in a vulnerable position with the US threatening a new round of sanctions.

The close bond might explain why Merkel had been advocating caution on punishing Russia in her talks with the United States. Analysts say she was hopeful that Putin would eventually back down and accept proposals to ease the crisis.

But her confidence in the Russian leader faded after he admitted that he had sent Russian troops into Crimea this spring.

John Lough, with the Russia and Eurasia Program at London’s Chatham House, says Germany is now starting to push a harder line against Russia.

“The Germans have been very shocked by Russia’s behavior and by the annexation of Crimea and the subsequent destabilization,” he said. “I think they see pretty clearly that Russia is playing a double game at the moment: that it is outwardly supporting the peace process at the moment, but it, at the same time, doesn’t seem to be doing much to try to defuse the conflict in the Donbas.”

The Obama administration’s new sanctions would include imposing a ban on any interactions with some of Russia’s largest banks, cutting off technology transfers to Russian energy and defense firms, and shutting down business with Russian defense companies.

This could prove difficult for the European bloc.

Source: VOANews.com

(Left to right: French president Francois Hollande, Ukrainian president Petro Poroshenko and German chancellor Angela Merkel at the European Council meeting on June 27 2014. Photo: The Council of the European Union)

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