Russia: Boris Johnson imposes sanctions amid Ukraine invasion
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Julian Jessop, an independent economist who previously advised the Treasury and several large banks, told Express.co.uk this afternoon (Tuesday) that the sanctions being prepared in retaliation to his recent moves would be “a huge blow” to the Russian economy. He added that Russia will have to face being a “big casualty” in terms of the economic fallout of any conflict.
Last night, Russian President Vladimir Putin ordered Russian troops into two separatist regions of Ukraine, after earlier recognising their independence from Ukraine.
Russia said it would be a “peacekeeping” mission, but is speculated to be a potential pretext for placing troops in Ukrainian territory.
Western leaders have reacted today (Tuesday) by preparing sanctions on Russia.
Foreign Secretary Liz Truss designated a package of sanctions targeting oligarchs “at the heart of Putin’s inner circle”, including the freezing of assets and travel bans.
Ms Truss said the UK Government was “prepared to go much further if Russia does not pull back from the brink.
“We will curtail the ability of the Russian state and Russian companies to raise funds in our markets, prohibit a range of high tech exports, and further isolate Russian banks from the global economy.
“These will be surgically targeted sanctions that will hit Russia hard.”
US President Joe Biden is expected to announce his own set of sanctions this evening, after the foreign minister of Ukraine and the US defence secretary met at the Pentagon earlier today.
Meanwhile, the EU today agreed new sanctions against Russia that will blacklist key figures and ban EU investors from trading in Russian state bonds.
German Chancellor Olaf Scholz also said that he had halted certification of the Nord Stream 2 pipeline – which was built to send natural gas directly to Germany, circumventing Ukraine – something which Russia had been doggedly vying for.
Mr Jessop speculated that Mr Putin’s aggressive moves towards Ukraine and the outcry from the West “might tip Russia into a recession”.
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He said: “Our trade with Russia is only a small part of our economy, but if Russia’s trade with every major economy in the West is hit hard by sanctions, that’s a huge blow to Russia.
“So Russia is going to be a big casualty, hopefully.”
The impact of the sanctions on the UK economy, however, would be “next to nothing”, Mr Jessop forecast.
That said, there were “potentially quite important indirect effects.
“One is through energy prices, and the other is through Russian retaliation in underhand ways – things like cyber-attacks.
“As far as energy prices are concerned, the oil price has risen further today and this is going to keep inflation higher for longer, so that’s one big impact.”
In terms of potential “underhand” responses from Russia, Mr Jessop commented: “The general increase in uncertainty is not good for consumer and business confidence or investor confidence.
“It’s hard to be more specific on that because we don’t know what Russia is going to do – but that is part of the problem.”
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