Further US sanctions would be ‘declaration of economic war’: Medvedev

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MOSCOW, Aug 10, 2018 (BSS/AFP) – Russia warned Friday that if the US
followed through with threats to impose further harsh economic sanctions it
would be seen as a “declaration of economic war”.

The warning by Prime Minister Dmitry Medvedev came after Washington
unveiled a raft of new sanctions against Russia over its alleged use of the
Novichok nerve agent against a former double agent which Britain has blamed
on Moscow.

The incident, which took place in a city in southern England in March,
triggered a major diplomatic crisis despite Russia’s denial of any role.

The announcement of the sanctions prompted Russian stocks and the ruble to
tumble on Thursday.

“While I don’t want to comment on the talk about future sanctions, I can
say that if we end up with something like a ban on banking activities or the
use of certain currencies, we can clearly call this a declaration of economic
war,” Medvedev was quoted as saying by the Interfax news agency.

“And we must absolutely respond to this war. By economic means, by
political means and if necessary by other means,” he added.

“Our American friends must understand this.”

Announced late on Wednesday, the first set of sanctions, which will take
effect in just under two weeks, impose a ban on the export to Russia of
“national security sensitive” US technologies.

Until now such exports had been previously allowed on a case-by-case basis,
with a senior State Department official saying the move could cut off
hundreds of millions of dollars worth of exports to Russia.

– Further sanctions loom? –

A second round of sanctions that could go into effect 90 days later would
cut far deeper, including blocking all American bank loans to Russian
entities, an outright ban on US exports to Russia, and suspension of
diplomatic relations.

The State Department said the sanctions were aimed at punishing Moscow for
having “used chemical or biological weapons in violation of international
law”, mandated under the Chemical and Biological Weapons and Warfare
Elimination Act of 1991.

However the sanctions announcement could bolster US President Donald
Trump’s claim that his administration is taking a tough stance on Moscow,
even as he continues to denounce as a “witch hunt” an independent probe
whether his election campaign colluded with Russia.

According to the 1991 Act, the president shall tighten the penalties within
90 days — unless the party in question provides “reliable assurances” that
it no longer engages in such activities, and allows on-site inspections by
United Nations observers.

Russia had on Thursday responded furiously to the sanctions, denouncing
them as “categorically unacceptable” as the markets tumbled and the ruble
fell to its lowest level in almost two years.

On Wednesday, Russia’s Kommersant daily published excerpts from another
piece of draft US legislation which proposes a ban on US citizens purchasing
Russian sovereign debt as well as steps against the country’s biggest banks
as well as its oil and gas sector, a key driver of the economy.

The sanctions follow the US Treasury’s imposition of sanctions in March
against 19 Russian citizens and five entities for interfering in the 2016 US
election — the toughest steps against Moscow since Trump took office.

Also in March, Washington ordered the expulsion of 60 Russian diplomats,
and the closure of Russia’s consulate general in Seattle over the Novichok
incident.

The Russian economy has only recently started to recover from international
sanctions imposed on Moscow in 2014 over its actions in Ukraine and a crash
in oil prices the same year.