The United States and its allies have “much more we can and will do” to punish Moscow if Russia fails to stop its invasion, Adeyemo told Reuters. Ukrainian leaders on Thursday called on the democratic world to stop buying Russian oil and gas and cut off all Russian banks from the international financial system. read more Sign up now for FREE unlimited access to Reuters.com Register After an initial attempt to freeze Russian assets, Washington and its allies announced gradual moves this week as they approach the limit of sanctions to punish Russia without also causing financial pain at home. read more A new investment ban announced Wednesday by President Joe Biden bans Americans from investing in shares and debt and investment funds of Russian companies, cutting off the Russian defense industry and other sectors from the world’s largest source of investment, Adem said. “This means that Russia will be deprived of the capital it needs to build its economy, but also to invest in its war machine,” Adeyemo said. Asked if he would ban companies already in Russia from further financing these activities, he said the finance ministry was consulting with the private sector. Kremlin officials, who have described their actions in Ukraine as a “special military operation”, insisted that Western sanctions would have no effect on their goals and would strengthen Russian support. Read more Adeyemo says the United States and its European allies will target Russian military supply chains to deny access to key components – “things that are important for building their tanks, supplying missiles and ensuring they have fewer resources” “to fight the war in Ukraine but also to show strength in the future. A local man rides a bicycle in front of a bomb crater as Russia’s attack on Ukraine continues, in the village of Demydiv, outside Kyiv, Ukraine, April 6, 2022. REUTERS / Vladyslav Musiienko read more “I believe the impact will be immediate in the same way that the impact on the economy was immediate,” Adeyemo said. Russia’s economy is shrinking by 10% this year and inflation is approaching 20%, US officials estimate. He declined to say whether a new list of sanctions on Russian state-owned companies expected on Thursday would include suppliers of components to the defense industry. White House Chief of Staff Brian Dees said Wednesday that the Biden administration’s latest sanctions package will ban trade with Russian state defense giants United Aircraft Corp., the maker of fighter jets Sukhoi and MiG, and Cor Sh. United. Adeyemo said Russia’s defense sector has been the first to set up companies since 2014 to acquire critical supplies and materials for building the Moscow army. Some of these companies were targeted for sanctions last month. RUPLE SUPPORT DRAWS WAR FUNDS Economic sanctions have forced Russia to spend more than its hard-earned energy revenues defending the ruble, Adeyemo said, using funds available for the war effort. After losing 45% of its value against the dollar in the first two weeks of the invasion of Ukraine, the Russian ruble has risen slightly below its pre-war level, thanks to capital controls by Moscow and distortions by the Russian central bank, Americans. officials say. read more “This means that Russia has less money and the president is forced to make choices between supporting the economy and investing in the war in Ukraine,” he said. Adeyemo said his meetings last week with European allies in London, Brussels, Paris and Berlin helped us focus on the next steps and helped speed up sanctions announced Wednesday. Read more. Adeyemo said he was encouraged by “strong statements” from European countries about reducing their dependence on Russian energy, but said the continent was in a different position from the United States, the world’s leading oil producer. “Because of our ability to generate energy at home, we were able to ban Russian oil imports to America relatively quickly,” he said. “It will take them longer, but what they are doing is reducing their dependence over time.” Sign up now for FREE unlimited access to Reuters.com Register Report by David Lawder Editing by Paul Simao, Heather Timmons and Howard Goller Our role models: The Thomson Reuters Trust Principles.
