EU sanctions hit Russia's access to finance and technology
Published 30/07/2014 | 02:30
The European Union has moved to curb Russia's access to bank financing and advanced technology in its widest-ranging sanctions yet over President Vladimir Putin's backing of the rebellion in eastern Ukraine.
EU governments agreed in Brussels to bar Russian state-owned banks from selling shares or bonds in Europe and restricted the export of equipment to modernise the oil industry, a key prop for Russia's economy, two EU officials said.
New contracts to sell arms to Russia and the export of machinery, electronics and other civilian products with military uses will also be banned.
Here, the Dublin Stock Exchange will be among firms affected. Its Russia-based clients include mainly state-owned Russian Railways, which has previously listed debt securities in Dublin. Under the sanctions regime those existing bonds are not affected but new debt issues are blocked.
"The political implications of the escalation in tensions are likely to cast a further chill over relations between Russia and the West," Citigroup analysts said.
Europe stopped short of the full-scale commercial warfare that could damage its own economy, which is still shaking off the euro debt crisis. The EU had lagged behind the US in heaping pressure on President Putin.
Rival interests among Europe's leading powers prevented the EU from going further, with France resisting a retroactive embargo that would scrap the sale of two warships to Russia.
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