EU Planning for Another Sanctions Package in May; Export Controls Starting to Bite, Top EU Official Says
The EU is aiming for a sixth sanctions package next month, European Commission Executive Vice President Valdis Dombrovskis told reporters in Washington, but there is still not unanimity among the 27 countries on how to treat Russian oil and on what to do about Sberbank.
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Dombrovskis also acknowledged that sanctions have been limited to advanced economies so far, such as Japan, South Korea, Australia, Canada, the U.K., the EU and the U.S. He said that the EU needs to work with a wider group of countries. Still, he defended Turkey, which has not joined sanctions, but has supported Ukraine by blocking Russian war ships from entering the Black Sea and by providing important weapons to Ukraine.
During his meetings in Washington with Secretary of Commerce Gina Raimondo and U.S. Trade Representative Katherine Tai, Dombrovskis said they discussed how they can coordinate "addressing supply chain disruptions from the war." He said there needs to be new sources of palladium, titanium and nickel, and suggested during his Georgetown Law Center speech that Australia or Canada could help there. The U.S. and EU need to talk about how "to depend on reliable democratic countries rather than aggressive autocratic countries," he said.
He said the sanctions on Russia have restricted its access to critical technology by 50%, which is rather significant, and said it's starting to affect Russia's military industry.
China is not a party to sanctions, and has significant technology offerings. Dombrovskis said during the Q&A following his speech that the recent EU-China summit was a difficult one. "There were questions that were left unresolved or unanswered. Clearly, there is more work that is needed." In addition to the EU's concerns that China is "hedging its bets" on Russia's aggression, he said, "There are certain problems piling up on the trade side" between the EU and China.
The EVP, who is from Latvia, said Ukraine's economy is expected to contract by 45% this year because of the devastation of Russia's attacks. In response to a question from Export Compliance Daily, he said the EU is assessing whether tariff preferences could be granted to Ukraine to help it recover economically.
In his speech, he said, "We must stay the course in supporting Ukraine and putting pressure on Russia.... Putin’s big mistake was to think there would be no consequences for his invasion."