Outsiders are eager, insiders are in turmoil, EC decides to do the "taboo" thing

Ukrainian Foreign Minister Dmytro Kuleba has just called on the European Union (EU) to start specific and serious discussions on the 12th package of sanctions against Russia, at a joint press conference with EU High Representative Josep Borrell (October 2).

Gói trừng phạt thứ 12 nhằm vào Nga: Người ngoài sốt sắng, nội bộ EU lại lục đục,. (Nguồn: https:apa.az)

The 12th package of sanctions against Russia: Outsiders are enthusiastic, the EC is determined to ignore the 'taboo', but the EU is in turmoil again. (Source: apa.az)

“It has been a summer, a long vacation, we can look back at what worked, what did not… But it is inexplicable why the 12th package of sanctions has not been approved yet. We call on the EU to discuss this 12th package of sanctions, to study specifically the sanctions against Russia,” the Ukrainian Foreign Minister said impatiently.

Accordingly, the head of the Ukrainian Foreign Ministry outlined to the EU two main focuses that should be included in this new sanctions package, one is measures to combat the evasion of existing sanctions and the other is new sanctions.

First of all, according to Mr. Kuleba, the new sanctions package must affect the Russian defense industry, which produces missiles and drones. At the same time, there are every reason to seriously consider sanctions against the Russian nuclear industry, while sanctions against Russian media entities should be expanded.

Urging the EU to implement a new package of sanctions soon, Foreign Minister Kuleba said: “We are ready to work constructively and effectively with the EU in this direction.”

However, within the EU itself, there is a division over the plan for the 12th package of sanctions against Russia, and what should be included in the package, although it is reported that the latest preventive measures are expected to be implemented as early as this October.

According to sources, the new sanctions package may include two major issues, which were "taboo" in the previous 11 sanctions packages - a ban on buying diamonds from Moscow and a proposal to use profits generated from the assets of the Russian Central Bank that are frozen abroad to support the reconstruction of Ukraine.

Meanwhile, countries including Poland and the Baltic states want to go further in proposing additional sanctions on liquefied natural gas (LNG) and information technology services.

Another group calls for restrictions on Russia’s nuclear sector. But efforts to punish Moscow over this sector have been opposed by too many EU member states many times before.

Some members argued that there were few areas where further sanctions against Russia could be implemented, while many called for simply ensuring existing restrictions were enforced.

Poland wants to strengthen sanctions on some of the items included in previous packages, according to a document obtained by Bloomberg News . Its proposals include reducing import quotas on synthetic rubber, implementing stricter restrictions on steel and adding a ban on solid caustic soda. Warsaw is also seeking a new sanctions package against Belarus.

Previous attempts to crack down on Russian gems in Europe have met with resistance from leading importing countries such as Belgium – home to the world’s largest diamond trading hub in Antwerp – which argued that a simple ban without a global agreement would only have the effect of shifting the lucrative gem trade elsewhere, without bringing any benefits.

Earlier, on September 15, a Belgian official said that the G7 group planned to "take the latest hit" against Russian diamonds. The group's ban on Russian diamond imports is expected to be issued within the next two to three weeks, expected to take effect on January 1, 2024. Once in effect, purchases of Russian diamonds will be affected by a direct ban, while an indirect ban will follow. The indirect mechanism will introduce a tracking system, including physical inspection of packages containing gems and mandatory traceability data for diamond producers and traders.

A spokesperson for the European Commission (EC), the EU’s executive body, did not immediately respond to a request for comment on the matter. But it is understood that the 12th package of sanctions could be launched in the first half of October or announced at the EU-US Summit at the White House on October 20.

However, any new sanctions package is likely to include further moves aimed at blocking Russia's ability to circumvent EU sanctions through third countries, such as the United Arab Emirates (UAE) and Türkiye.

As part of the discussions, the EC will put forward new proposals to impose a windfall tax on profits generated by the frozen assets of the Russian central bank at clearing houses, despite objections from the European Central Bank (ECB). The tax being considered is a windfall tax.

A row has broken out between EU and ECB leaders as the two sides failed to agree on a plan to use profits from more than 200 billion euros ($217 billion) of frozen Russian central bank assets to rebuild Ukraine.

EC President Ursula von der Leyen has proposed a tax on this huge amount of assets, but some member states have expressed concerns about financial stability and legality. EC officials have also challenged ECB President Christine Lagarde over the bank's warning that moves involving Russian assets frozen in the EU could threaten the financial stability of the eurozone and the liquidity of the single currency.

Russia has also repeatedly described any seizure of assets by Western governments as theft and against international law.

The EU has frozen 207 billion euros ($226 billion) worth of Russian assets since the Russia-Ukraine conflict broke out, including cash, deposits, and securities. It is estimated that the frozen Russian assets in Europe could generate around 3 billion euros a year.

Previously, the EU approved the 11th package of sanctions on June 23.

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