Derek H. Burney was Canada’s ambassador to the U.S. from 1989-1993. Fen Osler Hampson is a distinguished fellow and director of Global Security at the Centre for International Governance Innovation. They are the authors of Brave New Canada: Meeting the Challenge of a Changing World.
There is more nibble than bite in the most recent round of sanctions levelled against Russia by the European Union, the U.S., and Canada. They will likely do little to dissuade Russian President Vladimir Putin from the course he has already embarked upon – to destabilize Ukraine with a steady flow of arms, missile launchers, and troops.
Sadly, there is still no evidence of an effective strategy to counter Mr. Putin. Russians, meanwhile, continue to fawn over their “fearless leader” while he exploits the vacillation all too apparent in Western ranks and plays a deadly but popular game of Russian roulette with the country’s economic and political future.
The latest round of sanctions against Russia are pusillanimous or, if you prefer, gutless.
Unveiled last Tuesday in joint announcements by U.S. President Barack Obama and the EU after weeks of “agonizing dialogue,” the new sanctions target three of Russia’s state-owned banks, limiting their future access to capital markets in Europe and the United States. They also impose future-oriented, technology licensing restrictions on Russian oil companies that are supposed to thwart Russia’s development of deep offshore and shale oil deposits while also blocking future arms sales. A few more of Mr. Putin’s inner circle have also been added to the West’s no-fly list.
Their purpose, in the words of the European Council’s statement, is to serve as a “strong warning” that Russia’s “illegal annexation of territory and deliberate destabilization of a neighbouring sovereign country” is unacceptable.
But when you try to tiptoe on eggshells, it is hard to retain a sense of either balance or determination.
All the loopholes in the latest EU and U.S. tranche of sanctions are discouraging. The sanctions are targeted at “future” business, not current transactions – such as the sale of those $1.6-billion French warships, the first of which will be delivered in October presumably regardless of what happens before then. The sanctions are supposed to hurt Russia’s energy sector, but fail to include Russia’s natural gas companies for the simple reason that Europe is much more dependent on Russian gas than it is for oil. Even Exxon’s existing Arctic oil and gas project is carefully excluded. And there is still no tangible military assistance from the West for Ukraine even as Russia’s military buildup along Ukraine’s eastern border continues ominously.
Critics point out that new banking restrictions conveniently leave out Russia’s biggest and most influential lender – OAO Sberbank – which controls most of Russia’s banking assets. Nor are there any restrictions on credit card transactions. Subsidiaries of Russian banks that operate in Europe have also escaped the noose because European financial markets would take a hit.
Anglo-Franco relations have descended into name-calling and finger-pointing over who is doing more or, more accurately, less. When British Prime Minister David Cameron demanded that the French cancel their warship contract with the Russians, saying that it was “unthinkable,” President François Hollande retorted that the British were “hypocrites” for allowing Russian oligarchs to seek refuge in London and with U.K. banks. He has a point.
Mr. Putin must regard these displays of trans-Atlantic “unity” as little short of pathetic and confirmation of Lenin’s observation that you can rely on the capitalists to “sell us the rope with which we will hang them.” His officials have belittled the latest sanctions saying they will only serve to further strengthen the Russian economy while worsening diplomatic relations with the West. Meanwhile, Russia’s invitation to the next G20 session, hosted by Australia remains intact. So much for principle.
Faced with what looks like an imminent Russian invasion of eastern Ukraine and the continuing obstruction of a proper investigation of the Malaysian aircraft disaster, it is time for the West to move beyond baby steps and implement sanctions with bite, along with a major economic aid package and military assistance that makes Ukraine less ripe for the picking. If we cannot decide to punish Russia for violations of international law, we should at least resolve to help Ukraine.
As a matter of priority, the Alliance must take concrete steps to reduce Europe’s dependence on Russian energy. Although North America can’t fill the gap in the short term, allies should consider a joint strategy of energy security and environmental sustainability that will one day see alternative crude and natural gas sales – including North American – to Europe. Canada should move beyond strong rhetoric and take the lead, proposing a summit of North American and European leaders aimed at concluding a coherent strategy to secure the Alliance’s energy future.
It is time to show Mr. Putin that both he and Lenin are wrong.Report Typo/Error
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