President Joe Biden will sign an executive order on Friday authorizing the United States to impose so-called “secondary” sanctions on financial institutions that support Russia's war effort against Ukraine, a senior White House official said.
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“We want to target the materials that Russia absolutely needs for weapons production. (…) To get to these materials, (the Russians) have to traverse the financial system, which makes it a potential hotspot, and this tool targets that hotspot,” he explained.
The senior official, who spoke to reporters in an interview on Thursday and whose comments were embargoed, requested anonymity.
The United States, Ukraine's main backer, is banking on the deterrent effect of this announcement, which comes at a time when the American Congress is struggling to agree on further military support for Kiev.
“Frankly, our idea is that jurisdictions and financial institutions take action to put an end to their behavior before we have to use this new sanctions mechanism,” the senior official said.
“Ultimately, almost every bank in the world, given the choice between continuing to sell a small amount of goods to the Russian military-industrial complex or joining the American financial system, will choose to join the American system to join financiers. ” he said.
The senior official explained that most European or American banks have already stopped their financing activities in Russia, but noted that they are in contact with financial institutions in other countries that may continue to do so. TO DO.
Diamonds
Washington is therefore relying on these Western banks to prevent their partners in third countries from continuing to do business with Moscow.
The United States will also impose an embargo on products imported from countries other than Russia but made from Russian raw materials, such as diamonds, according to a senior official.
The West has already taken numerous asset freeze measures and embargoes against Russian entities, personalities and companies in an attempt to stop the war machine and undermine the economy.
The accumulation of Western measures has had a “significant impact” on Moscow, the senior official assured, estimating that Russia is having “difficulty” replenishing its weapons stockpiles and recalling that revenue from Russian hydrocarbons has fallen by about a third.
Nevertheless, almost two years after the start of the war in Ukraine, the Russian economy appears to be withstanding this avalanche of sanctions.
Russia continues to sell hydrocarbons, particularly to China and India, and experts say it has introduced effective mechanisms to circumvent, in particular, a cap on the selling price of its oil decided by the West.
According to Washington, Moscow has also expanded its military cooperation with Iran, which supplies the country with drones, and with North Korea.
According to the IMF, Russia is expected to grow at just over 2% this year and just over 1% next year.