How do Western sanctions on Russia impact EU economy?
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The Financial Times says Western sanctions on Russia could impact European energy, trade, manufacturing, banking, and trade markets.
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European economies could be hit hard by sanctions on Russia
The imposition of US or Western sanctions on Russia could heavily impact European economies, especially the energy, trade, manufacturing, and banking sectors, The Financial Times said on Wednesday.
The British daily said Moscow cutting gas to Europe is Russia's best play in the case of sanctions, but the repercussions of any Russian countermeasure would not only affect European energy.
European policymakers fear and acknowledge that Russia is much more prepared for any sanctions due to President Vladimir Putin's "Fortress Russia" strategy Moscow uses to overcome any harsher sanctions.
FT said the technology suppliers and the manufacturers and exporters of goods are highly dependent on raw materials, and any disrupted trade links would put a lot of pressure on European business.
The article added that the leaders of many major European countries are concerned about the economic repercussions, with many chief EU members voicing concern over their economies.
The EU counts on Russia as its largest energy supplier, with 40% of its natural gas imports and more than 33% of its crude oil imports coming from the bloc's eastern neighbor, and any disruption of flows would spark a hike in the already high energy prices within the bloc.
Russia is facing the threat of Europe canceling the Nord Stream 2 natural gas pipeline in case of any escalation with Ukraine, and the US is who pushed Berlin to use the pipeline as leverage.
"The geopolitical clouds that we have over Europe, if they were to materialize, would certainly have an impact on energy prices . . . but [they] would also impact growth as a result of reduced income and possibly as a result of reduced consumption and deferred investment," European Central Bank president Christine Lagarde had said last week.
The Nord Stream 2 issue is being turned into a pressure tool for Washington to leverage Moscow, Russian Deputy Foreign Minister Sergei Ryabkov said today, Wednesday, after US President Joe Biden said Monday the pipeline would not be launched if Russian troops cross the border with Ukraine.
"Nord Stream 2 has long turned into an instrument of pressure on Moscow in the hands of the United States and some figures outside the United States," Ryabkov told reporters.
As Germany and the United States threaten Russia with Nord Stream 2, the German Economy Ministry said the situation with the filling of gas storage facilities is a cause for concern.
As pressures increase, the German Economy Ministry said the situation with the filling of gas storage facilities was a cause for concern.
