Ukraine: Stressing coordination with EU, US tightens sanctions on Russia

President Obama moved ahead Wednesday with new sanctions against Russian energy, banking and defense firms – only hours before European Union leaders took related action of their own. 

Mr. Obama had informed European partners in a series of recent phone calls – including one Tuesday with German Chancellor Angela Merkel – that he was determined to levy new punitive measures against Russia for pursuing destabilizing activities in Ukraine.

But the president also informed the leaders that he hoped for common action to demonstrate unity among Western allies, senior administration officials said Wednesday.

“We have coordinated closely with our European allies in both the structure and timing (of measures against Russia) in the last weeks and months,” said one senior administration official, who demanded anonymity as a condition for discussing Wednesday’s action.

Noting that the European Union heads of state and government were holding a summit in Brussels Wednesday evening, the official said such meetings provided “an important moment to check in” and “natural moments for us to take action in coordination with our European allies.”

Obama was willing to go ahead alone with additional sanctions on Russia if he had to, officials said. But the White House has also said since Russia began deepening its involvement in the Ukraine crisis earlier this year that steps taken in coordination with the Europeans would be more effective – not least because Russia’s economy is much more dependent on Western Europe than on the US.

The EU measures were not as tough or far-reaching as those announced by the White House. But officials insisted the coordinated action demonstrated a “common purpose” and a unified front against what the US says is Russia’s continuing support for Ukrainian separatists and undermining of the government in Kiev.

The leaders in Brussels ordered European investment and development banks to suspend financing agreements with Moscow, the Associated Press reported.

The US actions Wednesday include a prohibition on new US financing for two major Russian financial institutions – Gazprombank and VEB – and two energy firms, Novatek and Rosneft. The measures will make it harder for the firms to secure medium- and long-term financing, officials said.

In addition, the Treasury Department designated eight Russian arms companies for sanctions, as well as a number of individuals, including four government officials. Among the latter are officials from the FSB, Russia’s federal security service, the self-declared “prime minister” of the Donetsk People’s Republic (one of the separatists’ breakaway zones), and an aide to Russian President Vladimir Putin.   

The US action reflects what officials say is conclusive evidence that Russia continues to arm and send provisions to pro-Russian separatists in eastern Ukraine. US officials referred to the downing of a Ukrainian military transport plane last month in Luhansk, another separatist stronghold, resulting in the deaths of 49 military personnel. The US concurs with Ukrainian officials who insist that the weapon used to down that plane, and others since, had to come from Russia.

Russia also continues to take actions that seek to undermine the government of Ukrainian President Petro Poroshenko, US officials say.

US officials emphasized that Mr. Putin had ample warning that tougher economic measures were coming if Russia did not take what the administration has described as a “diplomatic off ramp” by cutting the separatists’ lifeline and working with the new Ukrainian government.

“We have said for quite some time that Russia’s failure to take some of the steps that would de-escalate the conflict in Ukraine put them at risk of facing greater isolation and greater economic consequences,” White House press secretary Josh Earnest said at a briefing Wednesday.

Officials also sought to underscore the “common purpose” that Obama and Ms. Merkel established in Tuesday’s phone call. Merkel has emerged as a leader among European leaders in pressing for a tougher stance with Russia. But Germany, and Merkel personally, have also reacted strongly and disdainfully to recent allegations of US spying and have questioned the trust underpinning US-German relations.

Wednesday’s actions targeting Russia on both sides of the Atlantic demonstrate the strength of transatlantic relations, US officials said. They also insisted that the EU’s actions Wednesday, even if weaker than what the US announced, offered evidence of strong coordination with the US.

“It’s a little bit of a yin-yang [relationship],” one senior official said concerning US and EU punitive measures against Russia over Ukraine. “At times we’re catching up with them, at times they’re catching up with us.”