The Ninth Package of Sanctions - in Response to the Russian Escalation and Missile Attacks
Davit Shatakishvili, MPA, Tbilisi State University and German University of Administrative Sciences Speyer
On December 15, the EU countries reached an agreement on imposing a ninth package of sanctions against Russia. According to EU High Representative Joseph Borrell, after creating an artificial food crisis, the Kremlin is now using winter as a political-economic tool to leave millions of Ukrainians without water, heat and electricity. He said that the ninth package of sanctions is a response to more than 10 months of continuous aggression and the recent escalation of the situation in Ukraine, which is destroying critical civilian infrastructure and putting even more lives at risk. In addition to economic restrictions, the EU leaders agreed to provide Ukraine with a macroeconomic aid package of 18 billion Euros next year. In response, the press secretary of the Kremlin, Dmitry Peskov, said that Russia will study the list of sanctions and only then will it make a decision. However, considering the impact the sanctions are having, and Russia's economic downturn, the effectiveness of their retaliatory action is questionable. It would be interesting to take a look at what the ninth package of EU sanctions includes, and what impact it might have on the course of the war, as well as on the Russian economy and its recovery potential.
Extended Economic Constraints
According to the ninth package of sanctions, new restrictions will be imposed on exports from the EU to Russia, which will affect dual-use products and technological components that Moscow actively uses in its military and defense industry. In addition, restrictions will be imposed on an additional 168 companies that are in various ways connected to the Kremlin's military production. This decision will help to restrict Russia's access to chemicals, night vision and navigation systems, generators, electronics and hardware, such as hard drives, computer hardware, cameras and lenses. To reduce the risks of circumventing these sanctions, the restrictions also affect Russian-controlled entities located in the illegally annexed Crimea. Moreover, the list has been extended to components of the aviation industry, which includes aircraft engines and their spare parts. The following limitation also applies to manned and unmanned aerial vehicles such as drones. Important to note is that the export of aircraft engines and their spare parts was banned not only to Russia, but also to any third country, for example, Iran, which can potentially supply these products to Russia. It seems that Russia still has partner countries that directly or indirectly support its open aggression in Ukraine and even help circumvent the Western sanctions.
Within the EU's latest package of sanctions, the assets of two additional Russian banks will be frozen, and the “Russian Regional Development Bank” will be added to the list of Kremlin-controlled entities that are subject to a full transaction ban. Additionally, the new restrictions prohibit EU investment in Russia's energy and mining industries.
Despite the harsh and unjustified actions of the Kremlin in Ukraine, the European Union has not banned trade in agricultural and food products, including wheat and fertilizers, between Russia and third countries, in order to ensure world food security and so as not to promote a crisis, which Russia has repeatedly tried to artificially create. That is why, in order to avoid disruptions in financial transactions in food trade, the EU has presented an initiative that envisages a partial relief of frozen assets and a certain increase in access to economic resources for individuals and legal entities who play an important role in the world trade in agricultural and other food products. According to them, each such case is considered individually and this should not be perceived as any kind of compromise.
The Effectiveness of the Sanctions and the Continued Financing of the Russian War Machine
Each new package of sanctions is followed by some criticism about their effectiveness, the main argument being the fact of the continuing the war. Generally, the logical period for a sanction’s impact to become apparent is in the medium term, and expectations for immediate results are unrealistic, especially when it comes to the Russian Federation, which has immeasurably large energy and other natural resources. A number of restrictions imposed on the aggressor country by the European Union and other Western partners can take several months to enter into force, meaning a sanction adopted today may only start working after 6 months or more. Yet, there is no doubt that the sanctions are working, and the damage to the Russian economy will become more apparent in the medium to long term.
Clearly, restrictions do not mean a complete blockade of all types of trade. Moscow continues trade operations, both with its allies and even with countries which are imposing sanctions, with products that are not included in the restrictions. It continues to sell its own energy resources in China and other Asian countries, as well as in African countries. There is also a rumor that after the annexation of Crimea in 2014, Russia started mobilizing huge amount of funds within the country, and kept 40 USD from each barrel of oil sold in the so-called "black cashbox", potentially to deal with the crises that it is now facing. As such, it is clear where Moscow is getting the necessary funds for the war from, as well as for creating an imitation of the normal functioning of the economy.
Just a couple of weeks before imposing the ninth package of sanctions, on December 5, the decision of the G7 countries to set up an upper limit on the price of Russian oil came into force, which was joined by the United States of America, the European Union, Great Britain, Australia and Japan. As a result of the agreement, the global seaborne oil ceiling price was set at 60 USD per barrel. According to European leaders, this will significantly reduce the Kremlin's budgetary energy revenues. Countries that do not join this decision will not be able to use the services of EU maritime and insurance companies, or financial institutions, to carry out energy transactions. Moscow's retaliatory decision to this, and the contours of the consequences of the upper oil price limit, are likely to be outlined soon.
The coordinated decisions of Western partners and the economic sanctions significantly reduce the Kremlin's budget revenues, put into question its rapid industrial recovery potential, and minimize the risks of future Russian aggression in neighboring countries. The ninth package of sanctions presented by the European Union serves this purpose: To gradually exhaust Moscow's war machine. In this package, along with all other restrictions, the ban on the export of drone engines and their components, including to third countries, is undoubtedly one of the most significant moves, especially given the recent massive Russian missile attacks in Ukraine.
It is clear that the new restrictions will not stop the Russian aggression; however, they will definitely contribute to the significant deterioration of the country’s economic, military and industrial production capabilities. Frequently, new sanction initiatives give the impression that they have exhausted all resources, and that adopting the new proposal may be ineffective, or that there is no industry left to be subject to restrictions, which is clearly not the case. Sanctions always have a targeted function and a wide scope of action. Thus, the sanctions work and every new initiative is a step forward, not only to stop the Russian aggression, but also to prevent it in the future.
- Expected Political Consequences of the Restoration of Railway Communication Between Russia and Georgia through Occupied Abkhazia
- The 11th package of EU sanctions and Georgia
- Occupied Abkhazia and the Tskhinvali Region: Trade “Legalization” and Prospects of the Russian Transit Corridor
- Is Ukraine Winning the War and What Might Russia's Calculation Be?
- Russia's Diplomatic Offensive in Africa
- Russia’s New Foreign Policy Concept and the Occupied Regions of Georgia
- The Tenth Package of Sanctions - One Year of Russian Aggression
- Dynamics of China-Russia relations against the backdrop of the Russo-Ukrainian War
- The Russia-Ukraine War and Russia's Long-Term Strategic Interests
- Flight Resumption with Russia - Potential Consequences for Georgia
- Hybrid War with Russian Rules and Ukrainian Resistance
- Moldova’s challenges alongside the war in Ukraine
- Is Israel's New Government Shifting its Policy towards the Russia-Ukraine War?
- What does Russia want from Georgia?
- The Danger Russia’s Neighbors May Face after the Russo-Ukrainian War
- Belarus and Russia deepen trade and economic relations with occupied Abkhazia: A prerequisite for recognition of Abkhazia's “independence”?
- "Captured emotions" - Russian propaganda
- The Eighth Package of Sanctions - Response to Russian Annexation and Illegal Referendums
- What’s next for Italy’s foreign policy after Giorgia Meloni’s victory?
- War in Ukraine and Russia’s declining role in the Karabakh peace process
- The Russian Exclave of Kaliningrad and the Lithuanian "Sting"
- Seventh Package of Sanctions and Embargo on Russian Gold
- What could be the cost of “Putin’s face-saving” for European relations
- Failed Tskhinvali Referendum
- The War and Georgia
- “Rural Orbanism”- Polarization as a determinant for Hungary's political future
- Illegal Presidential Elections in the Tskhinvali Region: Why Bibilov Lost and What to Anticipate in Future
- How to Respond to Russian Ultra-Orthodox-Historic-Hegemonism?
- The War in Ukraine and the UK’s New Role in Eastern Europe
- What Will the Abolition of the OSCE Minsk Group Bring to the South Caucasus?
- Why Has the Abkhaz Side Become More Active on Social Networks?
- Why a Neutral Ukraine Is Not on Putin’s Mind (Ukraine’s Neutral Status Is Getting Closer, but What Does It Mean to Putin?)
- Europe's energy future - challenges and opportunities
- Uncontrolled Mass Immigration and the Position of the Georgian Government
- Changes in Putin's propaganda narratives since the Russian invasion of Ukraine
- Positions and Actions of Turkey in the Russo-Ukrainian War
- NATO’s possible expansion in Northern Europe and its significance for Georgia and Ukraine
- Political Winter Olympics in Beijing
- What Is behind Putin’s Sudden Gambit in Ukraine?
- L'Europe pourra-t-elle éviter le “déjà vu” ? (France, President of the Council of the European Union, and the Tensions in Eastern Europe)
- US-Russia Relations and the Issue of Ukraine
- The New Targets of Ramzan Kadyrov’s Regime
- What Will the Post-Merkel Era Mean for the EU’s Russia and Eastern Neighbourhood Policy?
- What Lies Behind the Growing Cooperation of the Georgian and Hungarian Governments
- “Doberman” as a Minister: Inal Ardzinba’s Prospects and Challenges
- The Belarus Crisis: How to Enhance Our Resilience Against the Russian Strategy for Its Near-Neighborhood
- Moldova’s Gas Crisis Has Been Russia’s Yet Another Political Blackmailing
- Belarus One Year On: An Insecure Regime Under Russian “Protection”
- Russia’s Parliamentary Elections - What Can Be Said About the Regime’s Stability
- Can Georgia use China to balance Russia?
- The West vs Russia: The Reset once again?!
- Formation of a New “Political Elite” in Abkhazia - Who Will Replace the Old “Elite?”
- The Cyber-Dimension of the Geneva Summit
- Securitization of the Arctic: A Looming Threat of Melting Ice
- Europe in Anticipation of the Results of a “Harmful Deal”
- (Re)Mapping the EU’s Relations with Russia: Time for Change?
- USA, Liberal International Order, Challenges of 2021, and Georgia
- The Political Crisis in Moldova: A Deadlock without the Way Out?
- Russia's Testing or Bullying?
- ‘Vaccine Diplomacy’: A New Opportunity for Global Authoritarian Influence?
- The End of the Russian Natural Gas Monopoly in Balkans
- Who did the judge sentence: Navalny, Putin or Russia?
- 2020 Developments in Abkhazia: “Elections,” the Pandemic and Deeper Integration with Russia
- Could Belarus Become a Prelude to the Great Polish-Swedish War 400 Years Ago?
- Vladimir Putin's Annual Grand Press Conference - Notable Elements and Messages
- Russia’s Energy Policy in the Tskhinvali Region
- Who Won and Who Lost with the War in Karabakh?
- What Russia has Gained in Karabakh
- What Armenia Did and Did not Lose as a Result of the Ceasefire Declaration in Karabakh
- Protests in Belarus, Lukashenko and the Russian Federation
- Some Thoughts on the Use of the Term „Post-Soviet Space“
- Khabarovsk Krai Protests as an Indicator of the Russian Federation’s Stability
- Trio Pandemic Propaganda: How China, Russia and Iran Are Targeting the West
- From Russia with… a Canny Plan
- “Elections” in Abkhazia: New “President’s” Revanche and Challenges
- Georgians Fighting the Same Battle 99 Years Later
- Confrontation between Russia and Turkey in Syria
- Political Crisis in Occupied Abkhazia
- What is the Significance of Killing General Qasem Soleimani?
- What Will the New Dialogue Format with Russia Bring for Georgia?
- On the “Russian Culture Center” in Georgia
- Main Messages of Russian Propaganda
- What do we know about the meeting of the Foreign Ministers of the Russian Federation and Georgia?
- New Focuses of the Anti-Occupation Policy
- Vladimir Putin’s Main Messages in his Interview with the Financial Times
- Georgia and Russia’s Post-modern Fascism
- Dugin has Come Out as a Supporter of Georgia – How Did This Happen?
- Deterring Russia
- On NATO, Russia and Pat Buchanan
- Modern Russia’s Own Wars of Religion
- Bolton’s visit to Moscow– what to expect in U.S-Russia relations?
- The Risk of the Renewal of the Karabakh Conflict after the Velvet Revolution in Armenia
- The Situation in Syria’s Idlib Province, Interests of the Parties and Threats
- The Helsinki Summit and its General Results
- Why It Is Necessary to Know the Day the Russo-Georgian War of 2008 Started
- Georgia’s Position in the Westernization Index 2018
- Why Did the Results of the G7 Summit in Charlevoix not Meet Our Expectations?
- How to Win Cold War 2.0
- The Russian “Ambassador’s” Rotation in Abkhazia
- Why did the Foreign Ministers of G7 not remember Georgia during their 23 April 2018 Toronto Meeting?
- Georgia and the American Strategy
- Putin’s Pre-Election Economic Promises: Myth and Reality
- Let Geneva Stay the Way it is
- Turkey’s Military Operation in Afrin – a New Phase in the Syrian Conflict
- Kremlin New Appointments and the Occupied Regions of Georgia
- Dangers Originating from Russia and Georgia’s Security System
- Eurasian Custom Union and problems of Russian – Georgian FTA
- Is Georgia’s Export Growth Sustainable?
- Russia’s Influence over the Field of Security in Tskhinvali Region is Growing: Support for Full Integration
- What Awaits the People of Gali?
- Growth of Military Spending and Relations with Russia: Azerbaijan trying to Gain Advantage over Armenia
- Disrupt and Distract: Russia’s Methodology of Dealing with the West
- Russian Diplomats in Georgia – who are they, how many of them are there and what are they up to
- Putin’s Visit to the Occupied Abkhazia: Was our Reaction Actually Adequate?
- Is it Acceptable for Georgia to Declare Neutrality?
- How to Stop the “Creeping Occupation”
- Kremlin’s Policy in the Occupied Regions of Georgia Moves to a New Stage
- Syrian Civil War in the Context of Regional Security
- The Winnable Second Round of Russia’s Neighbors’ Struggle against Its Imperialism
- Parliamentary Elections in Armenia – The Triumph of the Governing Party
- Current Foreign Policy of Georgia: How Effective is it in Dealing with the Existing Challenges?
- Observations on the Agreement Reached with Gazprom
- New Russian Weaponry in the Caucasus and Its Impact on Georgia’s NATO Aspiration