Western Sanctions and Russian Counter Sanctions: Reasons and Effects

_ Yuri Kofner, editor-in-chief, Eurasian Studies. Munich, 28 December 2018. First published as an interview for Euronews Persia.  Published for debate.

– What do you think are the real reasons for the introduction of US sanctions against Russia?

– Washington is guided by the interests of a small group of financial and military-industrial lobbyists. It presents these interests, depending on the president, either as protection of “Western freedom and democracy”, or as protection of its national” interests. The true aim of them is to preserve, by any means possible, the leadership of the United States in the global competition for the factors of production. Thus, their main task is to prevent the emergence of a power of equal potential to the USA. In the first half of the 21st century, only two blocks could become such – China and a potential continental block between the EU and the Eurasian Economic Union (EAEU).

The imposition of sanctions against Russia under the auspices of the United States should be seen as part of a century-long containment policy aimed at dominating Europe, i.e. the EU, and at preventing a potential alliance between Europe and Russia-Eurasia, i.e. the EAEU. Together, through their combined economic, military and cultural potential, they could really challenge the primacy of the United States in the world. This was also the main reason why the USA organized and supported the “euromaidan” coup d’etat in Ukraine.

– Why did the European countries join the US sanctions against Russia? How effective are these sanctions?

– Among the entire Western sanctions only those are effective, which are aimed at depriving the Russian banking system, and with it the entire Russian economy, the loans for long-term investment projects at lower foreign interest rates. Other types of sanctions, i.e. the ones, which are aimed at certain oligarchs or state companies, are rather symbolic in comparison.

Lower oil prices in 2014 and 2015 had a much greater effect on the GDP slump of the Russian Federation than sanctions.

In order to understand the reasoning behind the European countries joining the US sanctions against Russia, one cannot consider Europe as a single entity. Europe is divided into two camps -the Western and Central parts, i.e. “Old Europe” and Eastern Europe, i.e. “New Europe”, as former U.S. Defense Secretary Donald Rumsfeld liked to call it. The elites and a large part of the population of this “New Europe (foremost Poland, the Baltic states, but also Great Britain) for historical and political reasons, derive financial and political dividends from actively following Transatlantic policy in Eurasia.

On the contrary, a significant proportion of the elite of such countries as Germany, France and Italy, would like to have closer economic and even political relations with Russia and the EAEU.

However, the United States does not allow this. After the Second World War, European countries have been put under a strong military, political, economic and cultural hegemony of the United States. Most call this “Transatlantic unity”. I call it a “sweet occupation”.

– What results do countries aim to achieve with the introduction of sanctions?

– I think that those strategists from the Anglo-American intelligence community, as well as from the Washington and London base think tanks, who are developing the current sanctions policy, perfectly understand that the official purpose of the sanctions, i.e. to make Russia “return Crimea” and “get out of Donbass” will never be achieved. But this is not the real purpose of the sanction regime. Sanctions should rather be viewed as a “dirty expansion” of US foreign policy and subordinate Europe, aimed at deepening Russia’s economic and scientific and technical gap in the global race for leadership.

– Can the problems in the relations between the EU and Russia, the USA and Russia be solved in another way, without introducing sanctions?

– All the problems between the EU and Russia are artificially created and maintained by the United States. Their goal is to prevent the creation of a common economic space (alliance) between the EU and the Eurasian Economic Union. As soon as Washington’s influence over Berlin and Brussels diminishes, all disagreements between the Europe and Russia will immediately disappear. Econometric models by the Munich based ifo Institute show that the countries of Eastern Europe would indeed receive the greatest economic benefits from a potential common space between the EU and the EAEU.

As for the relations between the United States and Russia, I am sure that a compromise and a “balance of influence” could always be found. There are actually a lot of common interests between them: from the fight against global terrorism to environmental issues. But for this to happen, the United States ought to accept the end of the “Pax Americana”, i.e. the end of the Americentric monopolar global architecture and the fact that they will henceforth be only one equal power amongst equals.

– Russia introduced a regime of counter sanctions, are there any results from such a policy?

– The results are twofold.

Russia and the member states of the Eurasian Economic Union actually gain a lot from the policies of counter sanctions and import substitution. For example,  domestic agricultural production increased many times over. Now there is a whole lobby that opposes lifting the food embargo, even if the West would suddenly lift their sanctions. Counter sanctions have become a real factor in finally helping Russia to reduce, albeit slowly, its traditional raw material dependence. In recent years, since 2014, the trade share of non-commodities within the EAEU has grown steadily.

On the other hand, counter sanctions contradict the logic of a common internal market within EAEU without barriers. Moscow’s unilateral counter sanction measures have become a source of tension, albeit not serious, between with Belarus and Kazakhstan.

In fact, German entrepreneurs, Polish farmers and European banks have lost the most from the sanctions and counter sanctions. For example, according a recent report by the Russo-German Chamber of Commerce (AHK Russland), the losses of German companies amount to over 1.5 billion euros and approx. 300 000 jobs.

Source: https://fa.euronews.com/

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