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Poland and the Baltic states are proposing new punitive measures against the Russian economy, arguing that the first rounds of EU sanctions failed in their stated aim of ending President Vladimir Putin’s ability to wage war.
In the days following the invasion, European Commission President Ursula von der Leyen promised “crippling Putin’s ability to finance his war machine” and ruining the Russian economy. But the frustration is great that the Russian leader still keeps his head well above water financially; Europe still pays Russia hundreds of millions of euros a day for energy, and the ruble has bounced back to pre-war levels.
“Some EU leaders are treating the sanctions as a smokescreen for their inaction,” Polish Prime Minister Mateusz Morawiecki said. tweeted today. “Sanctions are meant to bring peace to Ukraine, not appease Europe’s guilty conscience.”
Central and Eastern Europeans disagree with their Western European counterparts on how difficult it is to turn the screws now. Poland is proposing a prohibitive tariff on Russian fuels, while Estonia is suggesting a special escrow account that will retain part of payments for Russian energy until Russian forces withdraw from Ukraine.
Western Europeans, on the other hand, want to avoid such drastic measures and officials in Brussels are currently preparing compliance measures to enforce the existing sanctions. Last week, European leaders agreed to focus only on implementing the current sanctions and closing their loopholes. “All of our efforts must be focused on enforcing these sanctions and preventing circumvention and evasion,” von der Leyen said last week.
In the eyes of Poland and the Baltic countries, it is a mistake not to increase the pressure now. They point to the worsening humanitarian situation in Ukraine and the demands of the Ukrainian government itself. “Russia continues to bomb Ukrainian cities and murder civilians, so sanctions must increase further,” Ukrainian Foreign Minister Dmytro Kuleba said. Recount its French counterpart this week.
“We took a little break, but the feeling of what we’re talking about is that the break is taking too long,” a senior EU diplomat said. “We must continue to pressure the Russian regime.”
Second choice options
Calls from Poland and the Baltics for a total ban on Russian energy – or at least an embargo on Russian oil – are being blocked by Germany and others, so they are now jostling for the second choice options.
“Large-scale sanctions such as an energy ban will likely sit in the fridge for now,” the top diplomat said. “There is no unity to go further. But that doesn’t mean we can’t move forward with other things.
This week, Morawiecki said Poland would end all Russian energy imports by the end of the year. The government will act first with a coal ban, which Poland wants to take effect in April or May at the latest. He called on other EU countries to do the same. “This is our plan for the EU – to wrest this weapon from the hands of Putin, from the hands of Russia,” Morawiecki said.
The European Commission is currently “assessing” the Polish government’s announcements, a Commission spokesperson said.
Poland has also called on the European Commission to introduce a tariff on Russian fossil fuels, as Brussels has exclusive competences over EU trade policy. A Polish official said that “detailed proposals on this solution are being prepared”.
“We would like to make importing Russian fossil fuels unprofitable; that’s where these proposals come from. However, we will continue to convince our partners to support an embargo on Russian fossil fuels,” the official added.
Estonia offers another compromise, urging Brussels to withhold part of Russia’s energy revenue in a special account that Moscow could only access once Russia withdraws its military. Thundering that the EU had paid Russia 22 billion euros since the start of the war, Estonian Prime Minister Kaja Kallas this week wrote a letter to von der Leyen, seen by POLITICO, proposing the escrow system after unsuccessfully pushing the idea last week European Council meeting with other Heads of State and Government.
Poland and the Baltic countries have also called on the Commission to ban truck traffic to and from Russia and Belarus and restrict ship access to EU ports. In a letter to the Commission last week and obtained by POLITICO, the countries also called for Russia and Belarus to be excluded from international agreements aimed at facilitating cross-border road traffic.
New sanctions packages
Despite this mounting pressure from countries feeling the heat of Russian aggression, the focus in Brussels remains on closing the loopholes in the sanctions already in place.
“We have to look back to see what kind of impact the measures we have already taken” have had, said outgoing Portuguese ambassador to the EU, Nuno Brito, and “what kind of shortcomings we still have “.
Therefore, the European Commission is preparing a “compliance package”, according to four EU diplomats and officials.
Among other things, this could focus on listing family members of oligarchs to avoid sanctions evasion, tightening export controls and potentially more sanctions against Russian propaganda channels, on top of previous sanctions. against Kremlin-backed media RT and Sputnik.
At the same time, the Commission is also preparing more far-reaching sanctions in case the EU needs to act quickly, for example in response to a chemical attack from Russia. But how such a broad set of sanctions would play out depends on the trigger and greater consultation with EU countries, taking into account their sensitivities.
“There are a lot of ideas floating around, but we don’t know which measures will be part of the next package and which will not. It will also depend on the trigger of course,” said another EU diplomat.
Zosia Wanat, Zia Weise, Hanne Cokelaere, Stuart Lau and Jacopo Barigazzi contributed reporting.
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