One year after the start of the war, who is winning it? Militarily, Kiev managed, thanks to Western support, to hold out. But from a commercial and diplomatic point of view, despite the economic sanctions decided by many countries, things could be different from what they seem. The trips of Russian Foreign Minister Sergey Lavrov to many African and Middle Eastern countries are irrefutable and extremely worrying proof of this.
Focused, as we rightly are, on trying to deal with the Ukrainian humanitarian catastrophe and defending the security of the entire European Union on the Donbass border, we are neglecting to consider the changes that are taking place in the rest of the world, without us Europeans, obliged to concentrate our forces in the military and commercial conflict (in which we find ourselves between the Russian anvil and the American and Chinese hammers), we are able not only to react, but not even to acquire awareness of the seriousness of the situation.
The facts. On March 2, 2022, the United Nations General Assembly, in an emergency meeting, asks Russia to withdraw its military forces from Ukraine “immediately, completely and unconditionally”: 141 of the 193 members of the United Nations support the resolution . China, India and South Africa are among 35 abstaining countries, while Eritrea, North Korea, Syria, Belarus and (of course) Russia vote against. The resolution is not binding, it only has political weight and increases Moscow’s international isolation. Far more concrete is the substantial series of sanctions against Moscow that countries such as Europe, the USA, NATO partners and, later, also Japan, Australia and New Zealand, implement by mutual agreement .
It is a long list of measures which responds to a military war with an economic war and which has a dual purpose: on the one hand, it attempts to weaken the Kremlin’s ability to finance the war, on the other, it imposes high economic and social costs on the Russia, aiming to weaken the domestic political front. This is nothing new: in 2014, with the unlawful annexation of Crimea, the West is targeting all those who do business in or with Crimea. Moscow’s reaction: the continuation of the attacks in Ukraine and the shooting down of the Malaysian Airlines plane (17 July 2014) with a surface-to-air missile launched by the Buk System[1] of the Russian secessionist forces, costing the lives of 298 civilians [2] (a few days ago the decision of the European Court of Human Rights to proceed against the Russian Federation which has always denied responsibility for the killing [3]).
The European Union and the US begin to target state banks, impose an arms embargo, limit the sales of technology and the export of equipment for the oil industry[5]. The Atlantic Council estimates that, as a result, Russia has lost potential foreign investment of $479 billion, or about a third of Russia’s GDP, and that GDP has contracted by 8%[6], even though the The estimate is controversial: some analysts argue that Russia’s real losses remain below 1% of GDP[7].
This time the sanctions are more aggressive, starting with the freezing of the Russian central bank’s foreign assets, which amount to $630 billion in foreign exchange reserves[8]. The Bank of Russia is suspended by the Bank of International Settlements[9], preventing anyone from trading in rubles. Some of Russia’s major financial institutions are barred from the SWIFT international financial trading system, a digital communication system needed for cross-border money transfers, leading to delays in payments to and from Russia, particularly in the energy sector[10]. . Transactions with state-owned enterprises, the provision of rating services to any Russian person or entity, and new investments in the energy sector are prohibited.
The US bans imports of Russian oil and gas[11] and the UK declares it will give up Russian oil by 2023[12]. The EU, which depends 25% on Russian oil and 40% on its gas, claims to become independent from Moscow by 2030[13]. Germany, for its part, is blocking the activation of Nord Stream 2, the pipeline built to bring Russian gas to Germany, and from there to the rest of Europe[14]. The sale of luxury goods, including cars, planes and boats, high fashion products and works of art is prohibited[15]; exports of goods intended for Russian companies are prohibited, especially in the military, computer, chemical, nuclear and electronic fields[16]. All flights of Russian airlines are banned from the airspace of the USA, UK, EU and Canada[17], the UK prohibits Russians from chartering and flying private jets[18].
A race against time begins: oligarchs and partners of the Russian regime must make their assets disappear before they are frozen[19]. The sanctions affect 386 members of the Russian parliament[20], as well as assets belonging to Russian President Vladimir Putin and his foreign minister Sergey Lavrov, frozen in the US, EU, UK and Canada[21]. But that’s not enough.
On 15 February 2023, Ursula Von der Leyen announces a new package of sanctions against Moscow: export bans worth more than 11 billion euros through blocks on the supply of electronics, special vehicles, spare parts, jet engines, construction materials construction such as antennas or cranes; the blockade is extended to seven Iranian entities and other third countries which supply Shahed drones and other war material during the war[22]. The new package also includes actions aimed at hitting the propaganda machine, making public lists of Russian propagandists, military commanders, politicians and oligarchs, against which their assets will be blocked[23].
Source: Glistati Generali
