The next round of sanctions will test EU unity on how heavy Russia’s influence is – POLITICO

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So far, the EU’s unity has been impressive when it comes to imposing four rounds of sanctions on Russia.

Moving to the next level of restrictive measures, however, will prove more difficult and expose some old diplomatic errors: Germany is extremely wary of calls from Poland and the Baltics to back it up. Russian President Vladimir Putin and cut off a vital source of energy income that helped power his war in Ukraine.

After a tumultuous period when EU countries initially failed to impose sanctions on the SWIFT payment system, the bloc’s ensuing solidarity against Russia has shaken even critics. the EU’s harshest quote. And European measures have played an important role in severely disrupting Russia’s currency and financial markets.

However, the fifth round of punishment is likely to prove a Rubicon. Ukraine, whose civilians have been killed in Russia’s indiscriminate air raids, insists that Putin’s oil revenues must be on the threshold and all Russian banks must be sanctioned. In a document obtained by POLITICO, Ukraine called for an outright energy embargo that “could significantly reduce the cost of the war and push Putin to the negotiating table.”

The resulting oil and gas is the elephant in the room when it comes to Russian finances. Kyiv insists that Putin can always stay in power and fund his war as he makes more than $600 million a day from energy sales and, in fact, Iran shows a sanctioned nation How high has maintained the sale of hydrocarbons.

Diplomats say that Poland and the Baltic states – which have been the most staunch of the Kremlin – strongly support Kyiv’s approach and stress the importance of oil and gas sanctions. “The money that we are using to pay for oil and gas from Russia is used to support the war against Ukraine,” Lithuanian Foreign Minister Gabrielius Landsbergis told POLITICO.

This led to a clash with Berlin, the economic pillar of the EU, which relies heavily on Russian energy and pursued years of political appeasement with Putin rather than diversifying supplies. Supported by Hungary and many other countries, Germany has said that oil and gas is not a good idea. Sanctions require unanimity, and aside from Poland and some other advocates, an outright ban on oil and gas appears far from achieved.

An important meeting of ambassadors takes place on Friday, which is expected to be a “pick-up” exercise. But one official said it’s possible Friday’s meeting could turn into a confrontation as some eastern states, led by Poland, are demanding faster action.

ONE EU leaders summit next Thursday and Friday is seen as the next major milestone in EU decision-making, but many diplomats and European Commission officials say the Commission could move faster if things escalate significantly in Ukraine.

It’s time to merge

To some extent, the sanctions debate has moved into a second phase, diplomats say. An EU diplomat said: “Work continues, but of course many member states are more cautious than in the early stages of the war.

The EU’s approach to sanctions over the past weeks has proven far more effective than it was in 2014 when, following Putin’s first invasion of Ukraine and annexation of Crimea, the Polish and Baltic states. was angered when Western European countries refused to introduce severe sanctions. This time, the West has moved, but the oil question threatens to revive the EU’s main diplomatic split in 2014 when Warsaw and Vilnius argued that Western nations did not understand the necessity of the EU. preventive measures.

However, EU diplomats insist that talking about the East-West divide over sanctions is too simplistic, especially since there is a large group of Eastern and Western countries that are building sanctions in general, but want to avoid mistakes.

“These fault lines are more complicated,” said another EU diplomat. “They were there from the beginning, but now it’s starting to show more that the sanctions are getting further and further away.”

Germany is crucial to the sanctions calculations and some directly accuse Berlin: “Unfortunately, Germany [is] is still preventing far-reaching sanctions, but you can’t have your pie and eat it,” one of the diplomats said.

Other diplomats insist Berlin is simply applying more care to the legal documents presented by the Commission, which are often the product of sleep-deprived officials, whose original manuscripts are close to Here are the legal issues. “The Germans have increased their level of surveillance and this is driving the Poles crazy,” another diplomat said.

The US and UK have imposed an oil ban to thwart the Kremlin’s war effort. Top EU officials such as EU Trade Director Valdis Dombrovskis, a former Latvian prime minister, also stressed that direct energy sanctions should be on the table.

While the EU has not ruled out ultimately targeting oil and gas, no such proposals have been put forward at the moment. “We were not at that point,” said an EU official.

That is not to say that EU capitals are shying away from making an economic impact for the greater good. The fourth package of sanctions, published on Tuesday, including a ban on a range of European luxury goods from the EU and imports of Russian steel products into the EU.

This directly affected a wide range of European sectors, such as Italian fashion brands, French luxury winemakers and the Belgian diamond businesses, and was unimaginable before the war. painting. In late February, just before Russia launched its invasion of Ukraine, Italy’s junior Trade Minister, Manlio Di Stefano, told POLITICO that for Italian luxury goods exports to Russia, sanctions Penalty can only be a “last resort”.

But there is a limit to how much pain they are willing to endure.

Legally watertight

EU diplomats stress that taking the foot off the accelerator of sanctions is not only in the national interest.

Brussels must ensure the swift imposition of sanctions that may survive any future legal challenges. We have to make sure that Putin’s friends cannot sue themselves out of these sanctions,” said another EU diplomat. This requires time, something officials did not have when the final package of sanctions was announced by Commission Chairman von der Leyen on Friday and discussed over the weekend.

“The Commission is working at a fast pace to come up with new sanctions packages, but seems to put speed above quality,” another EU diplomat said.

Diplomats also argue that the EU cannot fire all of its ammunition at once. Brussels must keep a number of options in its back pocket, they warn. Another EU diplomat said: “Putting everything on the table now would ruin the diplomatic process.

This week, the majority of countries want to focus on fix loopholes and ensure the agreed sanctions are properly implemented. This also allows some time for the current sanctions to hit the Russian economy.

“I beg you not to talk about sanctions again and again,” said German Transport Minister Volker Wissing. speak at a Die Welt event on Tuesday. “How should we handle the implementation of the sanctions that have been decided, because we must not back down an inch.”

At the same time, the European Commission is preparing the basis for the fifth package.

As has been the case since the beginning of the war, officials were reluctant to designate specific “causes” that would introduce new sanctions.

“We are in regular contact with the member states… we are willing to work on more, but we do not set up some specific triggers, as there are no specific triggers for the fourth package. or third. The reality is that Russia’s aggression continues to put pressure on Russia to stop,” EU trade director Dombrovskis said after a meeting of finance ministers on Tuesday.

Hans von der Burchard, David M. Herszenhorn, Stuart Lau and Nette Nöstlinger contributed reporting.

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