assets and banning dealings with the Russian financial institutions in
the latest western move to punish Moscow for its invasion of Ukraine.
The US Department of the Treasury said on Monday the sanctions will
deprive Russian President Vladimir Putin of funds he needs for the war
“The unprecedented action we are taking today will significantly
limit Russia’s ability to use assets to finance its destabilizing
activities, and target the funds Putin and his inner circle depend on
to enable his invasion of Ukraine,” Secretary of the Treasury Janet
Yellen said in a statement.
A senior US administration official told reporters on the condition of
anonymity that freezing the central bank’s assets will weaken Russia’s
ability to keep its currency afloat amid sanctions targeting its
banking system and economic activity.
“Putin’s war chest of $630bn of reserves only matters if he can use it
to defend his currency, specifically by selling those reserves in
exchange for buying the rouble,” the official said. “After today’s
action, that will no longer be possible and ‘Fortress Russia’ will be
exposed as a myth.”
The Treasury also said in a statement that the sanctions will “disrupt
Russia’s attempts to prop up its rapidly depreciating currency by
restricting global supplies of the ruble and access to reserves that
Russia may try to exchange to support the ruble”.
The move was taken in coordination with allies, the US government
said. The United Kingdom, European Union and Canada also announced
their own penalties against Russia’s central bank.
“This has never been done before at this scale – today we are taking a
historic step by directly censuring Russia’s central bank,” Chrystia
Freeland, Canada’s minister of finance, said in a statement on Monday.
“Canada is firmly on the side of the heroic resistance of the people
of Ukraine and we will continue to take further action to ensure
President Putin does not succeed.”
Monday’s measures came a day after Washington and its partners cut off
key Russian banks from the SWIFT financial messaging system, a network
that enables international money transfers.
Russia launched an all-out invasion of Ukraine last after a
months-long standoff in the region that saw Moscow amass as many as
200,000 troops near the Ukrainian border.
Russia initially denied US and European allegations that it was
planning to invade Ukraine, insisting that it has legitimate security
concerns about Kyiv’s deepening alliance with the West – and demanding
guarantees that Ukraine will not be allowed to join NATO.
Numerous rounds of talks between Russian, European and American
officials had failed to end the impasse.
Fighting has been intensifying across Ukraine during the past days,
with Russian troops closing in on major cities, including the capital
Kyiv and Kharkiv. More than 500,000 people have already fled Ukraine
since Russia launched its offensive, the United Nations said on
Ukraine’s health ministry said on Sunday that 352 civilians, including
14 children, have been killed since the start of the war.
Russian and Ukrainian officials began talks at the Belarusian border
on Monday, with Kyiv demanding an immediate ceasefire and withdrawal
of Russian troops.