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Obama seeks to tie Trump’s hands, imposes more sanctions on Russia

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

The Obama administration leaves office with a sting in its tail, announcing more sanctions against Russia over Crimea and the war in the Donbass.

The additional new sanctions are minimal and largely symbolic.  They affect nine regional units of the Russian gas producer Novatek, a number of subsidiaries of the Russian Agricultural Bank, Crimean Ports, Crimean Railways, the Stroiproekt Institute, which is one of the organisations involved in designing the Kerch bridge project, the Karst company, which is one of the main subcontractors for the Kerch bridge project, the Transflot shipping company, two ships belonging to the Transflot company (Marshal Zhukov and Stalingrad), and FAU Glavgosekspertiza Rossii, which is the Russian agency responsible for expert reviews of design documents and findings of engineering surveys.

In addition individual sanctions have been imposed or extended against 7 individuals.

Six of these individuals (Kirill Kovalchuk, Dmitri Lebedev, Dmitri Mansurov, Mikhail Klishin, Oleg Minaev, and Mikhail Dedov) are sanctioned because they are connected to Bank Rossiya, ABR Management, or Sobinbank.

Bank Rossiya was placed on the US Treasury’s original sanctions list in 2014.  The Obama administration believes – quite groundlessly – that Vladimir Putin has a personal connection to Bank Rossiya, and has insinuated that he is in fact its owner.  There is in fact no evidence that Vladimir Putin had any special connection to Bank Rossiya before US sanctions were imposed on the bank in 2014, though after the sanctions were imposed, and in response to them, Putin publicly said he would open an account with it.

The seventh individual placed on the sanctions list is a Russian businessman, Yevgeny Prigozhin.  The US Treasury justifies its decision to place him on the sanctions list in this way

Prigozhin has extensive business dealings with the Russian Federation Ministry of Defence, and a company with significant ties to him holds a contract to build a military base near the Russian Federation border with Ukraine.

Prigozhin is moreover accused of

having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, senior officials of the Russian Federation.

The expression “senior officials of the Russian Federation” is widely recognised code for President Putin himself.

If there is an overarching theme to these new sanctions, it is that they either sanction individuals and companies engaged in upgrading Crimea’s infrastructure – in particular the Kerch bridge – or continue the practice of targeting individuals the Obama administration has (wrongly) convinced itself are custodians of Vladimir Putin’s mythical billions.

The Russians have already made clear that the new sanctions will not affect the Kerch bridge project, and that they reserve the right to undertake what they call an “asymmetric response” to them.

What does the Obama administration achieve by imposing these ineffectual sanctions a month before it leaves office?

The short answer is that the sanctions do not seem intended to target Russia so much as Donald Trump, who has made clear that he wants to improve relations with Russia.  In particular they seem designed to make more difficult the Senate confirmation of Rex Tillerson (Donald Trump’s choice for Secretary of State) who as CEO of Exxon has made known his opposition to the sanctions.  Quite possibly demands will be made that Trump and Tillerson commit themselves to maintaining the sanctions in order to secure Tillerson’s confirmation.

If so then this shows the extent to which hostility to Russia has become for the Obama administration an obsession.  It seems that even in its dying days it is doing all it can to make sure its hostility to Russia remains US policy even after it is gone, by trying to tie the hands of the next President, who is known to favour a different policy.

The Russians themselves have understood the frankly pathological quality behind this latest action, making dark predictions that it won’t be the last one before the Obama administration ends its life.  Russian Deputy Foreign Minister Sergey Ryabkov said as much shortly after the new sanctions were announced

I won’t be surprised if on January 20, the day of inauguration of the next US president, one minute before Donald Trump takes office, at 11:59, we will once again see behind some curtain, in the corner, those who continuously produce such kind of decisions once again inventing certain rescripts, decisions, pushing into an abyss relations with Russia that are already in tatters due to Washington’s irresponsible and senseless policy.

Whether that is indeed what will happen, and whether the Obama administration really can tie the hands of the next President in this way, remains to be seen.  In the meantime it is a frankly sad and even disturbing way for the Obama administration to see out its life.



The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

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