How should the EU act on the Ukraine crisis?

Transcript:How should the EU act on the Ukraine crisis?:
How should the EU act on the Ukraine crisis? Webinar 15 February, 2022 Vienna-Kyiv Sanctions: view from Ukraine Igor Burakovsky, Head of the Board, Institute for Economic Research and Policy Consulting Why Russia presents a special “economic case”: Russia is a Permanent member of UN Security Council with a special voting power. The "right to veto“ gives Russia possibility to block any UN Security Council decision to sanction against Russia and its allies. Therefore unilateral coercive measures is the only option. Specific Russian political economic structure: Russian strategic companies (especially wholly or partly state owned) have been directly or indirectly heavily engaged in Russian domestic and external policy implementation. Russia is a leading or large supplier of gas, oil, ferrous and non-ferrous metals, metallurgical and chemical products etc., and consumer of a wide variety of industrial and consumer goods. Such international presence immediately puts the issue of costs not only for the countries initiating sanctions but the issue of international implications of the sanctions in question. Russia’s potential to mitigate sanctions induced economic shocks using various political, financial and regulatory tools. Sanctioning Russia: special policy case 1. Post factum sanctions. Sanctions to punish for misbehavior (violations of international law) Sanctions on Russian companies and individuals in connection with the annexation of the Crimea and Russia's direct involvement in a military conflict in Eastern Ukraine (more than 500 companies and 300 individuals}. 2. Conditional sanctions. Sanctions to punish the country in case of resorting to certain actions. Sanctions on Russia in case of large scale military aggression. Currently under discussion. 3. Preventive sanctions. Sanctions imposed to prevent certain actions (wrongdoings). No discussion at the moment. Why? Sanctions regimes 1. Costs of sanctions for Russia. Goal: making economic costs unbearable (provoking economic crisis? Economic collapse?) Preconditions: Well-defined and well-coordinated sanctions policy; 2. Costs of sanctions for international community Goal: cost effective sanctions policy (acceptable price for the international community). Preconditions: Well-defined and well-coordinated sanctions policy (the costs must be adequate – no less, no more); Measures to minimize the burden of sanctions if any (?); Costs of sanctions: two issues 1. Business in countries imposing sanctions: sharing costs of sanctions against as a form of global social responsibility (ethical business)? 2. Military de-escalation: sanctions strategy: If sanctions fail for some reasons – what to do further on? If sanctions work – what to do with sanctions package (keeping gunpowder dry)? If sanctions