The US has recently widened its sanctions on Russia, particularly targeting banks dealing with entities that have been sanctioned. This expansion comes as part of a broader effort to crack down on institutions aiding Russia’s war efforts in Ukraine. In addition to targeting banks, the US has also imposed sanctions on the Moscow stock exchange, leading to a halt in trading in dollars and euros. Moreover, there are efforts to restrict Russia’s access to technology, including chips and software.
The move to sanction parts of Russia’s financial system, such as the Moscow Exchange, is significant as it is one of the country’s main stock exchanges. This will have implications not only for Russia but also for global financial markets. By expanding sanctions to about 4,500 entities, the US aims to create a financial embargo on Russia, making it challenging for the Kremlin to access critical materials and equipment needed for its war efforts.
Furthermore, the focus on technology in the expanded sanctions programme is crucial. The discovery of US-made chips and tech in Russian equipment used in the Ukraine conflict prompted the US to target companies supplying such technology. The restrictions on shell firms in Hong Kong and limits on software and IT services for sanctioned entities demonstrate the effort to disrupt Russia’s military capabilities.
While the International Monetary Fund predicts some economic growth for Russia despite the sanctions, experts believe that over time, the sanctions will weaken Russia’s economy and make it harder for Moscow to sustain its war efforts. The move to broaden sanctions comes as US President Joe Biden prepares for a G7 summit to discuss support for Ukraine and address the ongoing conflict with Russia. The joint effort by G7 leaders to boost assistance for Ukraine highlights the shared commitment to countering Russian aggression and supporting the sovereignty of Ukraine.
