G7 weighs new sanctions on Russia to end Ukraine war
Hiroshima, Japan – Some say sanctions against Russia have left the country more isolated than at any time since the aftermath of the 1917 Bolshevik Revolution, when World War I Allies placed the country under a blockade.
At the Group of Seven summit in Hiroshima, Japan, on Friday, the club of wealthy democracies is expected to tighten the screws in a bid to force Moscow to end its war in Ukraine.
While the existing sanctions against Russia are some of the toughest ever imposed on a major economy, the G7 has plenty of room to step up the pressure – although divisions over key areas such as energy and the mixed track record of sanctions are generally threaten to undermine efforts to take Moscow to the top. heel.
“There is definitely enough room for the G7 to impose further restrictions and tighten the existing ones,” Rachel Lukasz, a member of the International Working Group on Russian Sanctions at Stanford University, told Al Jazeera.
“Key areas include oil and energy more broadly, non-energy trade sanctions and closing loopholes in this area, and technology sanctions.”
One of the main focuses of the G7 members – the United States, Canada, Japan, the United Kingdom, France, Germany and Italy – is expected to improve enforcement of existing sanctions, including curbing sanctions evasion involving third countries are.
On Saturday, G7 finance ministers and central bank governors pledged in a joint statement to oppose “any attempt to circumvent and undermine our sanctions”.
The EU, which participates in G7 events as an “unlisted” member, is considering sanctions for companies that help Russia circumvent the sanctions, which would bring the bloc closer to the US sanctions regime.
In an interview published Tuesday with the Financial Times, European Union foreign policy chief Josep Borrell said the bloc should crack down on imports of Indian petroleum products that use Russian oil.
The administration of US President Joe Biden is also pushing to tighten controls on high-tech exports by reversing the premise of banning anything not explicitly allowed.
Picking up the slack
Despite forecasts of economic downfall, Russia’s economy has held up better than expected against the Western-led sanctions regime, contracting just 2.1 percent by 2022.
While Russia’s trade with the G7 countries has plummeted, China, India and Turkey have made up much of the backlog with increased imports of Russian coal, oil and gas.
Some investigations also suggest Western shipping companies are involved in violating sanctions on Russian energy exports.
In a study published last month by the Kyiv School of Economics, researchers found that 96 percent of oil shipments from Russia’s port of Kozmino in the first quarter of 2023 were sold above the $60 oil price limit set by the G7 last year. .
“On the sanctions front, the summit will be about implementation, implementation and implementation,” Agathe Demarais, global forecasting director for the Economist Intelligence Unit, told Al Jazeera.
“This follows a flurry of media reports highlighting sanctions evasion by third countries, such as Turkey, Serbia, Kazakhstan and the UAE. Instead of lowering the oil price cap, the G7 will focus on tightening up the effective implementation of this measure.”
But Demarais, who is also the author of Backfire: How Sanctions Reshape the World Against US Interests, said it is unclear whether the G7 will be able to effectively close the loopholes “given the magnitude of the problem and the creativity of the Kremlin to circumvent it. sanctions”.
There were also signs of division among G7 members before the three-day summit.
While the G7 is reportedly considering proposals to permanently close natural gas pipelines shut down by Russia following its invasion of Ukraine, European members would be hesitant to support such a move.
Politico quoted an unnamed EU diplomat on Wednesday as saying it was “very unlikely” that the measure would pass due to European members’ continued dependence on Russian gas.
Do sanctions work?
More broadly, the G7 must cope with the limited success sanctions have had so far in bringing about change in Russia and in other pariah states such as North Korea and Cuba.
In a state-of-the-nation speech marking the first anniversary of the war in Ukraine in February, Russian President Vladimir Putin sought to prepare his country for a protracted conflict that would achieve its successes “step by step”.
Kristy Ironside, a historian of modern Russia and the Soviet Union at McGill University in Canada, said the historical data on the effectiveness of sanctions was “rather pessimistic.”
“I tend to view them with skepticism: they are an attempt to ‘do something’ when immediate options are limited, that is, when you don’t want to put boots on the ground,” Ironside told Al Jazeera.
“Sanctions, or rather their mere threat, work best when there is a high degree of pre-existing economic integration or desired economic cooperation, but that has been limited since 2014. Russia has since made the economy sanction-proof by developing domestic food chains. , moving currency reserves to yuan, etc.”
“The application of sanctions and the threat of more has not stopped Putin from continuing this war,” Ironside added, “and at this point I think it is safe to say they will not. “
But Lukasz, a member of the Russian sanctions group at Stanford University, said the sanctions were already affecting Russia’s military campaign and the G7 should step up its efforts to support Ukraine and weaken the Russian state.
“It is impossible to know exactly what impact the sanctions have had on Russia’s readiness to fight this and future wars because we do not observe the counterfactual world without sanctions,” he said.
“But the direction of the impact is clear: this war has already been a disaster for Russia and the Kremlin, and with Western support it will sooner or later turn into disastrous defeat.”