Russia: Prime Minister Promises Retaliation for Sanctions

12 August, 2018, 10:47 | Author: Carlos George
  • Russia news

Russia's prime minister on Friday warned the United States against imposing new sanctions on Russian Federation and said the Kremlin would view any ban on banking or the use of the dollar by Moscow as a "declaration of economic war" that would provoke a strong retaliation.

Economists expect the Russian economy to grow by 1.8 per cent this year.

According to the State Department, those sanctions will include the presumed denial of export licenses for Russian Federation to purchase many items with national security implications. But if the proposed sanctions are implemented in full, this could drop to nearly zero in future.

Moscow's strategy of trying to improve battered U.S. -Russia ties by attempting to build bridges with President Donald Trump is backfiring after U.S. lawmakers launched a new sanctions drive last week because they fear Trump is too soft on Russian Federation.

The sanctions follow the US Treasury's imposition of sanctions in March against 19 Russian citizens and five entities for interfering in the 2016 US election - the toughest steps against Moscow since Trump took office.

Some additional sanctions proposed in Congress include legislation targeting Russia's state-controlled banks and freezing their operations in dollars.

"If something like a ban on bank operations or currency use follows, it will amount to a declaration of economic war", he said. "And this war will have to be responded - by economic, political and, if necessary, other means".

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Background: The Defending American Security from Kremlin Aggression Act of 2018, which calls for sanctions on Russian sovereign debt, banks and energy projects, was recently introduced in the U.S. Senate. "Our American friends should understand that".

The threat of more USA sanctions kept the rouble under pressure on Friday, sending it crashing past two-year lows at one point before it recouped some of its losses.

Medvedev said while the US says the restrictions are meant to punish Russia's "bad" behavior, their real goal is to sideline a rival.

A second round of sanctions that could go into effect 90 days later would cut far deeper, including blocking all American bank loans to Russian entities, an outright ban on United States exports to Russia, and suspension of diplomatic relations.

Previously, similar periods of volatility were "temporary in nature", it said.

Medvedev warned the US that such a move would cross a red line.

While it was hard to assess so far in advance, they said it was more likely that only some of its provisions would be included as amendments in another piece of legislation, such as a spending bill Congress must pass before September 30 to prevent a government shutdown.

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