Allies resist US plan to ban all G7 exports to Russia
The EU and Japan have rejected a US proposal for the G7 countries to ban all exports to Russia, as part of negotiations ahead of a summit of the world’s most advanced economies.
A statement by G7 leaders being drafted for their meeting in Hiroshima next month includes a promise to replace the current sector-by-sector sanctions regime against Russia with a full export ban with some exemptions, according to documents seen by the Financial. Times. The full export ban would include exemptions for agricultural, medical and other products.
The proposal was made by the United States, according to two officials. It comes amid growing frustration in Washington with the existing system riddled with loopholes that allow Russia keep importing western technology.
But representatives of Japan and EU countries suggested in a preparatory meeting last week that such a move would not be feasible, according to three people briefed on the discussions.
“From our perspective, it’s just not feasible,” said one of the officials, who spoke on condition of anonymity.
The White House National Security Council declined to comment on the talks with the G7 partners, but said the United States “will continue to look for ways to hold Russia accountable.”
“In coordination with our G7 partners, we have implemented the largest set of sanctions and export control actions ever imposed on a major economy,” an NSC spokesperson said. “These actions have had a significant impact, undermining Russia’s ability to finance and fight its unjust war.”
The disagreement over the measure underscores the lack of additional options available to G7 leaders as they seek to increase economic punishment for Vladimir Putin’s regime after 14 months of war, following a series of sanctions measures that were designed to isolate vast swaths of Russia’s economy from Western imports of technology, machinery and finance.
Cracking Down on Sanctions Evasion and circumvention by third countries is the main focus of the US, UK, EU and other allies, with increased pressure on states such as Turkey, the United Arab Emirates and Central Asian countries that have increased trade with Russia since Western sanctions were imposed.
G7 leaders will meet in Hiroshima on May 19 for a three-day summit that will focus on the effects of Russia’s war on Ukraine, economic security, green investment and the Indo-Pacific region.
The EU, which is a member of the G7 along with the US, UK, France, Germany, Italy, Japan and Canada, requires all of its 27 members to agree on a sanctions policy.
It has agreed to 10 sanctions packages against Russia since February 2022, but only after weeks of wrangling between member states, some of which have secured exceptions and waivers for their industries by threatening to veto the restrictions.
Replacing that regime with a full export ban plus exemptions would risk reopening those discussions and potentially weakening existing measures, the officials said.
Other, less contested proposals listed in the draft declaration, which could change before the summit, include more measures to restrict the “evasion and circumvention” of existing sanctions and against those who “deliberately support Russia’s war financing.” , including facilitators of financial transactions.
The G7 countries will also continue to reduce their imports of Russian energy and prevent “the reopening of pathways previously closed by Russia’s militarization of energy,” the draft statement says. In addition, the leaders will announce plans to introduce a “traceability mechanism” on Russian diamonds to reduce the Kremlin’s profits from their export.
Additional reporting by Leo Lewis in Tokyo