Public and Private Sanctions Against Russia And Support For Ukraine

In response to the Russian invasion of Ukraine, governments, private businesses, and non-governmental organizations around the world are taking sweeping action to isolate Russia and Belarus, and people influential in those regimes, from their international investments, international trade, and international cultural exchanges. 

Meanwhile, they are taking some steps to help Ukrainians on the fronts of cutting immigration red tape, providing economic aid, and providing military aid.

The broad scope of these sanctions short of direct military action (which other Ukrainian allies have largely refrained from out of fear of a Russian nuclear strike), imposed so quickly, is almost unprecedented.

The sanctions, collectively, look likely to severely harm the Russian economy far more than any economic benefit that it will receive from its invasion of Ukraine, could do permanent, long term harm to Russian economic might, and make it far more costly for Russia to continue its military actions than it would be otherwise. 

This economic pain could also heighten domestic dissent in Russia, a topic that I'll reserve for a possible future post.

Economic Sanctions 

Russia is buckling under a raft of severe wide-ranging sanctions imposed by the U.S. and its allies. They have restricted the country's access to its overseas currency reserves and barred many of its banks from SWIFT, a global network that financial firms use to conduct transactions.

As a result, the value of the ruble has plummeted, Russia has been forced to raise interest rates sharply and the country has kept its stock market closed to prevent further economic and financial pain. 

From National Public Radio.  

The Treasury Department on Monday moved to further cut off Russia from the global economy, announcing that it would immobilize Russian central bank assets that are held in the United States and impose sanctions on the Russian Direct Investment Fund, a sovereign wealth fund that is run by a close ally of President Vladimir V. Putin.

. . .

On Saturday, the European Commission, Britain, Canada, France, Germany, Italy and the United States said they would remove some Russian banks from SWIFT, essentially barring them from international transactions, and impose new restrictions on Russia’s central bank to prevent it from using its large international reserves to sidestep sanctions.

From the New York Times.

Italy has embraced sanctions against Russia despite receiving 40% of its natural gas from Russia.

As of 9 p.m. Eastern Time Wednesday, Russian aircraft are prohibited from entering U.S. airspace.

President Biden announced he was ordering that in his State of the Union address Tuesday night, joining the European Union and Canada in banning Russian planes, part of a worldwide effort to punish Russia for its invasion of Ukraine.

The Putin regime is expected to reciprocate and prohibit U.S. aircraft from entering Russian airspace. That could mean longer flights as jets are rerouted around closed airspace, but aviation industry experts say Russians will likely feel the greater impact.

According to a statement from the U.S. Department of Transportation, the order prohibits all passenger, cargo and charter flights on "all aircraft owned, certified, operated, registered, chartered, leased, or controlled by, for, or for the benefit of, a person who is a citizen of Russia."

Any aircraft operators who violate the ban on entering U.S. airspace "may be intercepted, and their pilots and other crewmembers detained and interviewed by law enforcement or security personnel, as appropriate."

From National Public Radio. 

While China has not formally taken a stand against Russia, China has also not supported Russia, and "two of China’s largest state-owned banks restricted financing for purchases of Russian commodities[.]"

Business Boycotts and Private Disinvestment 

Energy giant BP helped kick off the corporate exodus on Sunday, when it announced plans to unwind a 20% stake in Rosneft, the Russian oil giant. . . . two of BP's competitors, Shell and Exxon Mobil, followed suit. 

. . .

Volvo Cars and General Motors have halted vehicle exports to Russia, while Harley-Davidson said it "has suspended its business in Russia and all shipments of its bikes to the country." 

. . . 

Dell has suspended product sales, and Apple has also "paused all product sales in Russia," according to a company spokesperson, who noted, "Apple Pay and other services have been limited."

Several of the world's largest shipping companies are no longer servicing customers in Russia, including UPS, FedEx and Maersk. The Danish shipping company said it "has now suspended bookings to/from both Russia and Ukraine until further notice," with the exception of "foodstuffs, medical and humanitarian supplies."

From National Public Radio. 

On Monday, Equinor, the Norwegian energy company, said it would “stop new investments into Russia” and “start the process of exiting” joint ventures there.

From the New York Times.

Russian oil trade was in disarray on Tuesday as producers postponed sales, importers rejected Russian ships and buyers worldwide searched elsewhere for needed crude after a raft of sanctions imposed on Moscow over the war in Ukraine. 

. . . 

Russia is the second largest exporter of crude worldwide, trailing only Saudi Arabia, as it ships out 4 million to 5 million barrels per day (bpd) of crude, along with 2 million to 3 million bpd of refined products. 

. . .

Russia's key Urals oil grade was bid at a discount of more than $18 below physical Brent crude, the primary worldwide benchmark, a record in the post-Soviet era. Even at that price, traders have been unable to find willing buyers.

"Nobody wants to buy, ship or store Russian oil," a trader of Russian oil said.

In response to the severity of the disruption, the International Energy Agency (IEA) said it would coordinate a release of 60 million barrels of oil reserves from big consumers, with half coming from the United States.

From Reuters.

A tanker ship from the former Soviet Republic of Georgia has refused to refuel a Russian ship.

Russian entities, including the country’s main development and military banks, one of its sovereign wealth funds and a subsidiary of the state-controlled energy giant Gazprom. It has sought to freeze Mr. Putin’s assets as well as those of his foreign minister, Sergey V. Lavrov, and other Russian national security officials. And it has curbed purchases of Russian sovereign bonds, barred some Russian banks from Western financial markets and cut off Russia’s access to certain foreign technology products.

The European Union and Britain have taken similar punitive measures and also have banned some military-related exports to Russia

From the New York Times.

Airplane manufacturer Boeing says it has suspended major operations in Moscow and temporarily closed its office in Kyiv.

From the Associated Press.

Liquor stores and bars around the world are discontinuing sales of Russian vodka. In U.S. states where liquor stores are state run, this is being ordered by some state Governors.

Many investment pools, public and private, are divesting themselves of Russian investments. Public investors doing so include California pension funds, Colorado's pension fund, Norway's sovereign wealth fund, and the U.S. state of Georgia.

Sanctions Against Russian Oligarchs. 

Switzerland, a favorite destination for Russian oligarchs and their money, announced on Monday that it would freeze Russian financial assets in the country, setting aside its tradition of neutrality to join the European Union and a growing number of nations seeking to penalize Russia for the invasion of Ukraine. The country said it would immediately freeze the assets of Mr. Putin, Prime Minister Mikhail V. Mishustin and Foreign Minister Sergey V. Lavrov, as well as all 367 individuals the European Union imposed sanctions on last week. 

From the New York Times.

Germany has promptly seized the $600 million yacht of a Russian oligarch. 

Another Russian oligarch is selling off his interest in one of the leading soccer teams in the world with the proceeds going to a charity to benefit Ukrainians.

The U.S. Justice Department has established a task force to enforce sanctions against Russian oligarchs.

Sports and Cultural Sanctions

Russian teams and competitors have been excluded from international sports organizations from the International Chess Federation, to FIFA and UEFA that run global soccer competitions, to World Cup competition in winter sports, to international basketball competitions. Other organizations including the International Paralympic Committee, World Taekwondo, and the International Tennis Federation, will allow Russian and Belorussian competitors to compete as unaffiliated neutral individuals, but not as part of their national teams. A leading sports video game producer is even removing Russian teams from its video games.

New York's famed opera house, the Metropolitan Opera, announced Sunday that it will suspend its ties to Russian artists and institutions who are allied with Russian President Vladimir Putin. . . . Carnegie Hall and the Vienna Philharmonic Orchestra dropped Gergiev and pianist Denis Matsuev from a three-concert series due to the two musicians' close ties to Putin.

Also dropping Gergiev as conductor were the Munich Philharmonic and the Rotterdam Philharmonic.

From National Public Radio. Other venues worldwide have followed suit.

For 20 years, Vladimir O. Potanin, one of Russia’s richest men, has been a key supporter of the Guggenheim Museum, serving as a trustee and major benefactor while his foundation sponsored exhibitions, including the current show in New York about the Russian artist Wassily Kandinsky. But the museum said on Wednesday that Mr. Potanin was stepping down as one of its trustees, a position he has held since 2002.

From the New York Times. 

Diplomatic Condemnation and Legal Action

Russia on Friday vetoed a United Nations Security Council resolution denouncing its invasion of Ukraine while China, India, and the United Arab Emirates abstained from the vote.

From National Public Radio. 

The United Nations General Assembly on Wednesday approved a nonbinding resolution condemning Russia for invading Ukraine and demanding that it withdraw its military forces. . . . he resolution passed overwhelmingly by a vote of 141-5 with 35 abstentions. The five countries that voted against it were Russia, Belarus, Syria, North Korea and Eritrea.

From National Public Radio.

The chief prosecutor of the International Criminal Court opened an investigation on Wednesday into allegations of war crimes, crimes against humanity or genocide committed in Ukraine since 2013 and during Russia’s current invasion of the country.

From the New York Times.

Protesters are defiling and protesting in front of Russian embassies.

Russian diplomats are being expelled from many countries where they embassies, and called to account to the governments in the countries hosting them in other countries, like Greece.

The United States says it is expelling a Russian “intelligence operative” working for the United Nations, in addition to the 12 members of the Russian Mission to the United Nations whose expulsions were ordered Monday for engaging in espionage.

From the Associated Press. 

Pro-Ukrainian Refugee Policies 

Countries across Europe and the world have cut through red tape to welcome the more than one million Ukrainians fleeing the conflict in the last week. 

Poland, Hungary and Moldova are also welcoming thousands of Ukrainians fleeing the war.

From the New York Times. 

Ireland also promptly welcomed Ukrainian refugees.

The European Union is expected to grant temporary protection to all Ukrainians, as record numbers of refugees fleeing Russia’s invasion move into the bloc, in what rights advocates warn could become a massive humanitarian crisis.

From the New York Times. 

Many people are also fleeing from Russia to Finland by train.

Economic Aid To Ukraine

Elon Musk is trying to help by providing satellite internet service to Ukraine and free access to electric car charging stations for Ukrainians.

European utility companies are adding Ukraine to their electrical grids which have been cut off from Russia and Belarus.

Wells Fargo and Bank of America, two of the largest financial institutions in the United States, pledged on Wednesday to each donate $1 million to humanitarian relief in Ukraine. . . . 

The BBC announced on Wednesday that it had turned to an old-fashioned form of radio broadcasting to keep Ukrainians informed about the war. The broadcasting company said it had launched two new shortwave frequencies, which can be heard on cheap, portable devices, that can be received clearly in the Ukrainian capital of Kyiv and parts of Russia.

From the New York Times.

About $34 million of cryptocurrency has been donated to Ukraine. Sony is making a $2 million humanitarian donation.

Military Aid

The Dutch are sending rocket launchers for air defense. The Estonians are sending Javelin antitank missiles. The Poles and the Latvians are sending Stinger surface-to-air missiles. The Czechs are sending machine guns, sniper rifles, pistols and ammunition.

Even formerly neutral countries like Sweden and Finland are sending weapons. And Germany, long allergic to sending weapons into conflict zones, is sending Stingers as well as other shoulder-launched rockets.

In all, about 20 countries — most members of NATO and the European Union, but not all — are funneling arms into Ukraine to fight off Russian invaders and arm an insurgency, if the war comes to that.

At the same time, NATO is moving military equipment and as many as 22,000 more troops into member states bordering Russia and Belarus, to reassure them and enhance deterrence. 

. . . 

While 21 of the 27 European Union countries are also members of NATO, the effort to move equipment and weapons rapidly into Ukraine from Poland is being carried out by individual countries and is not formally either a NATO or E.U. operation.

The French say that the E.U.’s military staff is trying to coordinate the push. Britain and the United States are doing the same, setting up something called, deliberately blandly and neutrally, the International Donors Coordination Center. It is doubtful that Mr. Putin will be fooled by the name. . . . even if no NATO soldier ever crosses into Ukraine, and even if convoys of matériel are driven to the border by nonuniformed personnel or contractors in plain trucks, the European arms supplies are likely to be seen in Moscow as a not-so-disguised intervention by NATO. 

. . .

On Feb. 25, the day after Russia attacked Ukraine, the White House approved a $350 million package of weapons and equipment, including Javelins and Stingers. Pentagon officials said shipments began flowing within days from military stockpiles in Germany to Poland and Romania, from where the matériel has been shipped overland through western Ukraine.

Poland’s prime minister, Mateusz Morawiecki, promised Ukraine to provide tens of thousands of shells and artillery ammunition, antiaircraft missiles, light mortars, reconnaissance drones and other reconnaissance weapons. 

. . .

Sweden, not a member of NATO, announced that it would send Ukraine 5,000 antitank weapons, 5,000 helmets, 5,000 items of body armor and 135,000 field rations, plus about $52 million for the Ukrainian military. 

Finland, similarly, has said it will deliver 2,500 assault rifles and 150,000 rounds of ammunition for them, 1,500 antitank weapons and 70,000 combat rations.

From the New York Times.