With the certainty of sanctions being imposed on Russia in the event of them invading Ukraine, British foreign minister, Liz Truss said that the UK will not hesitate to freeze the assets of any major Russian business or any oligarch linked to the Kremlin. Truss said, any Russian business that has “economic or strategic significance” to Russia could be shut out of operating and that their owners will face a tough series of sanctions as a part of new legislation.
This includes having their assets frozen. Being banned from doing business in the UK and being banned from entering the country. It came from Truss, as prime minister Boris Johnson travelled to Ukraine to discuss the unfolding crisis with President Volodymyr Zelensky.
“Those in and around the Kremlin will have nowhere to hide. We will make sure those who share responsibility for the Kremlin’s aggressive and destabilising action will share in bearing a heavy cost.’’
Truss said, “I will not say exactly who we may target or with what measure. Moscow should be clear that we will use these new powers to maximum effect if they pursue their aggressive intent towards Ukraine. Nothing is off the table.”
There is widespread evidence that much of Putin’s wealth is held in the name of Oligarchs that the new legislation in the UK seeks to target. Fund manager and prominent Russia critic, Bill Browder, said: “the cleanest, safest and simplest way of deterring Vladimir Putin from invading Ukraine is to go after his money.
“We know who these oligarchs are who hold Putin’s assets, we know that they are held in London, the easy way of doing things for us in a very asymmetric way as far as Putin is concerned is to freeze the money of a certain number of Oligarchs’’, Browder told Sky News.
Earlier this month Johnson had said: “I think that an invasion of Ukraine, would be an absolute disaster for the world, and above all it would be a disaster for Russia.”
On the issue of sanctions, as of yet the UK and its international partners have remained purposefully vague about what their new sanctions regimes might look like. The secretive approach is aimed at keeping the Kremlin guessing and limiting its ability to prepare itself, said David Savage, head of financial crime at London firm Stewarts, the litigation specialists.
From the rhetoric coming out of Westminster (parliament) as well as the White House, it seems both London and Washington will focus their sanctions on individuals linked to the Kremlin, as they edge away from imposing more far-reaching sanctions on the wider Russian economy.
The UK has already broadened its powers to slap sanctions on people linked to Putin, while the Biden administration has said it plans to target Putin’s inner circle.
The European Union is keeping the option of more far-reaching sanctions on the table. This could see the EU lock Russian banks out of the global financial system, by blocking them from Swift.
“This would cause quite a significant amount of global turmoil’’, savage said as he warned that Russia is “highly likely to retaliate” against any major sanctions by restricting flows of oil and gas to Europe.
However, any drop in Russia’s energy exports would have a major impact on the Russian economy — which generates 60 per cent of its export revenues from energy — and come as a major hit to Europe at a time of soaring gas prices. Nonetheless, experts warned that any UK business with links to Russia or supply chains in the country should be ready to cut ties. Smart businesses will already be thinking about whether they can get their supplies from other countries.
