As the Ukraine War enters second year, the Joe Biden administration approved a new $2 billion arms package and announced new sanctions on Russia.
Russian President Vladimir Putin announced the invasion of Ukraine on February 24, 2022. Just days before the first anniversary, Biden had travelled to Ukrainian capital Kyiv to meet Ukrainian President Volodymyr Zelenskyy and reaffirm the US support to the country.
On Ukraine War's first anniversary, Biden and fellow leaders from the Group of Seven (G-7) allies that have been at the forefront of backing Ukraine stayed focused on a unified front.
"Our solidarity will never waver in standing with Ukraine, in supporting countries and people in need, and in upholding the international order based on the rule of law," the G-7 leaders said in a joint statement after a virtual meeting with Zelenskyy.
Latest US arms package to Ukraine
As Ukraine mourned its war dead and vowed it would ultimately emerge victorious, the US Department of Defense (DoD) unveiled its latest weapons package. It includes more ammunition, electronic warfare detection equipment and other weapons to counter Russia's unmanned offensive, defensive and surveillance systems, including the upgraded Switchblade 600 Kamikaze attack drone.
The latest aid package uses the Ukraine Security Assistance Initiative to provide funding for longer-term contracts to buy weapons and equipment.
Unlike the presidential drawdown authority that the DoD has used repeatedly over the past year to pull weapons from its own stocks and quickly ship them to Ukraine, the USAI-funded equipment could take a year or two to get to the battlefront. As a result, it will do little to help Ukraine prepare for an expected new offensive in the spring.
US Defense Secretary Lloyd Austin said, "Difficult times may lie ahead, but let us remain clear-eyed about what is at stake in Ukraine to ensure that a world of rules and rights is not replaced by one of tyranny and turmoil."
Latest US sanction on Russia over Ukraine War
Meanwhile, the White House said that new sanctions hitting over 200 people and entities will "further degrade Russia's economy and diminish its ability to wage war against Ukraine". The Biden administration will also further restrict exports to Russia and raise tariffs on some Russian products imported to the US.
"Now, not only does Ukraine stand, but the global coalition in support of Ukraine is stronger than ever, with the G7 as its anchor," Biden said on Twitter following Friday's virtual meeting with Zelenskyy.
The new sanctions introduced by US Treasury on Friday hit Russian firms, banks, manufacturers and individuals, taking aim at entities that helped Russia evade earlier rounds. Russia's metals and mining sector are among those targeted in what Treasury called one of the “most significant sanctions actions to date.”
Treasury Secretary Janet Yellen, attending meetings in India on Friday with fellow financial chiefs of the Group of 20 leading economies, called out Russian officials in attendance and insisted the world's biggest economies must do more to support Ukraine.
She said, "I urge the Russian officials here at the G-20 to understand that their continued work for the Kremlin makes them complicit in Putin's atrocities. They bear responsibility for the lives and livelihoods being taken in Ukraine and the harm caused globally."
The US State and Commerce departments as well as the Office of the US Trade Representative also issued plans Friday to increase pressure on Russia. These steps impose visa restrictions on 1,219 members of the Russian military, increase tariffs on Russian products such as metal, worth roughly USD 2.8 billion, and add nearly 90 Russian and third-country companies, including from China, to a list of identified sanctions evaders.
More than 30 countries representing more than half the world's economy have already imposed sanctions on Russia, making it the most sanctioned nation in the world.
The sanctions have imposed price caps on Russian oil and diesel, frozen Russian Central Bank funds and restricted access to SWIFT, the dominant system for global financial transactions.
The US and allies have directly sanctioned roughly 2,500 Russian firms, government officials, oligarchs and their families. The sanctions are depriving them of access to their American bank accounts and financial markets, preventing them from doing business with Americans, travelling to the US and more.
By Friday afternoon, the Paris-based Financial Action Task Force, an international standard-setting body on illicit finance, suspended Russia from its membership. The removal occurred for the first time in the body's 34-year history.
Britain also announced new sanctions Friday on firms that supply Russia's battlefield equipment and says it will bar export to Russia of all items it has used in the war, such as aircraft parts, radio equipment and electronic components of weapons.
“We don't think the job is by any means done," Britain's Treasury chief Jeremy Hunt said.
No signs of Russian pull-back from Ukraine War
Still, as the conflict enters a second year, there are no indications that Putin will retreat from the conflict. And the avalanche of international sanctions that have been steadily hoisted on Moscow over the past year have yet to deliver the sort of knockout blow to the Russian economy that the White House — and independent economists — predicted at the outset of the war.
The Russian economy has weathered sanctions better than expected in 2022, in part due to “the slow introduction of commodities sanctions", according to a Moody's Investors Service report on Friday.
The Russian economy is expected to weaken in 2023, with GDP shrinking by 3 per cent this year, according to the Moody's projection. The economy shrank 2.2 per cent in 2022, far short of predictions of 15 per cent or more that Biden administration officials had showcased at the start of the war.
Export controls and financial sanctions are gradually eroding Russia's industrial capacity, but oil and other energy exports last year enabled Putin to keep funding the war.
White House National Security Council spokesman John Kirby acknowledged that Russia's economy was "showing some resilience" but he also said it's not clear that it "can be sustained for the long haul".
Of Putin, he said, "He has had to take some drastic measures to prop up his economy, to prop up his currency, including playing pretty aggressively with interest rates for instance."
(With AP inputs)
