EU Warns Of Economic Uncertainty After Russia’s Ukraine Moves
Russia’s recognition of breakaway regions of Ukraine will “strongly increase” economic uncertainty for the EU, the bloc’s economy commissioner Paolo Gentiloni said on Tuesday.
“Uncertainty remains around us. And the violation of international law through Russian recognition of two separatist territories in Ukraine will strongly increase this uncertainty,” Gentiloni told a Brussels conference.
Gentiloni was speaking as EU ambassadors met to agree on sanctions against Russia for its recognition a day before of two separatist regions in Ukraine that have been militarily supported by Moscow for the past eight years.
Russian President Vladimir Putin has ordered troops into those separatist regions, breaking international agreements he had signed on to. He portrayed the incursion as a “peacekeeping” mission.
The European Union was expected to unveil limited and targeted economic punishment, both to keep its sanctions powder dry should Russia push further into Ukraine and because of the pain it would feel too from sectoral sanctions.
Russia supplies more than a third of the EU’s natural gas supplies, and energy prices are already spiking to uncomfortable levels for European consumers and governments.
Gentiloni, speaking at an EU conference on the bloc’s economic situation, noted that the growth forecasts for this year had already been revised down earlier this month to 4.0 percent, and up to 2.8 percent for next year.
Conflict or tough sanctions on Russia that blowback into Europe could add to the downward pressure on the Covid-hit economy.