Left-wing politician Wagenknecht and AfD representatives are calling for a stop to EU sanctions against Russia. Are the measures as bad as some think? Figures on Russian oil exports are fueling the debate.
Brussels – A flourishing Russian arms industry and high oil prices are raising new doubts about the effectiveness of Western sanctions over the war of aggression against Ukraine.
Do the USA and the EU have to recognize that their global influence in the 21st century is much more limited than expected? EU chief diplomat Josep Borrell recently described gloomy assessments of the effectiveness of punitive measures as “simply not correct”. Questions and answers at a glance:
How is the Russian economy doing after unprecedented punitive measures from the West?
From the EU’s perspective, it’s anything but rosy. According to figures from Brussels, Russian economic output shrank by 2.1 percent last year. High-tech sectors, which had grown steadily until the start of the war, recorded particularly heavy losses. According to the EU, the production of motor vehicles fell by 48 percent in 2022 compared to the previous year, and the production of computers, electronics and optics fell by eight percent.
With a view to the current year, the EU recently referred to a report from the Organization for Economic Co-operation and Development (OECD). According to him, Russia’s economic output is likely to fall again by up to 2.5 percent.
In addition, the situation of the Russian state budget is expected to worsen. It is said that the government in Moscow still has budgetary flexibility. Funding for schools, hospitals and roads is already being cut, while almost a third of the budget is being spent on defense and internal security.
Despite extensive export restrictions, the ability to wage war hardly appears to be suffering. Why is that?
One reason is that Russia’s defense industry is not dependent on supplies from the West in many areas. In addition, the West cannot dictate to third countries which products they should and should not deliver to Russia.
For example, Russia now simply imports some high-tech products from or via China instead of from the EU or other neighboring countries. The West hardly has any leverage to prevent possible new arms deals from Russia to countries like Iran or North Korea.
However, politicians are betting that the sanctions will increasingly have an impact outside the military sector. It is pointed out that most modern aircraft operated by Russian airlines rely on European and American spare parts and technical assistance, which have been banned.
Recently there have been increasing voices that the oil sanctions against Russia are not having the desired effect. Is that correct?
The sources for this are confusing. EU chief diplomat Borrell claimed at the end of August that the oil sanctions had proven successful. He pointed out that in April 2023 the International Energy Agency (IEA) reported an average Russian crude oil export price of around $60 per barrel, which corresponds to a discount of $24 per barrel compared to the global oil price.
The IEA estimates that Russian oil revenues are 27 percent lower overall than in the previous year. At the same time, it is positive that the overall volume of Russian oil exports was maintained as intended. This contributed to the stabilization of world markets.
The government in Moscow, however, recently boasted that the price of oil from the Russian brand Urals is now above the price cap of $60 set by the West. In addition, reference is made to figures according to which Russia earned $17.1 billion from oil exports to countries such as India and China in August.
One reason for the limited effectiveness of sanctions is the principle of punitive measures. In order to enforce the price cap for Russian oil exports to non-EU countries, it was decided that in the future services important to Russian oil exports may only be provided with impunity if the price of the exported oil does not exceed the price cap. However, the EU can only take punitive measures for evading sanctions against domestic companies.
How does the EU view possible sanctions violations?
Borrell recently admitted that circumvention of EU sanctions must be combated more decisively. “To this end, we are intensifying our cooperation with key third countries and urging them to closely monitor and take action against trade in EU-sanctioned goods, particularly those found on the battlefield in Ukraine,” he said . However, room for maneuver is also seen in the control of Western companies.
In Germany, left-wing politician Sahra Wagenknecht and representatives of the AfD, among others, are calling for the sanctions against Russia to be lifted. What are they about?
They are less critical of the effect of the sanctions on Russia than on Germany. Wagenknecht recently said in the Bundestag that the war in Ukraine was of course a crime. But with an “unprecedented economic war” against Russia, the government is risking the poverty of families in Germany and jeopardizing the supply of cheap energy to German industry. Germany needs “Russian raw materials and, unfortunately, Russian energy for the foreseeable future.”
However, even several left-wing politicians distanced themselves from it. Wagenknecht “does not speak for the left,” explained, for example, deputy party leader Lorenz Gösta Beutin. dpa
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