The Ukraine-Russia crisis is going to affect every sector in one way or another. We witnessed cryptocurrencies taking a plunge when Russia recognized two regions of Ukraine as independent and deployed troops to ‘maintain peace’. This may just be the beginning of what Vladimir Putin, President of Russia can do.
Before Russia does any further damage to Ukraine, Joe Biden, President of the United States of America has a contingency plan in place to punish the actions of Russia. Mr. Biden on Tuesday announced the first part of the round of sanctions that the country will impose on Russia. Along with the U.S., many other Western countries have also started imposing sanctions on the country and these sanctions are not the worst that they can impose. These sanctions are mostly targetting individuals and financial institutions.
Wally Adeyemo, U.S. Deputy Treasury Secretary, on Wednesday said that the country is ready to respond to any damage caused by Russia, by withholding technology and resources. This was not announced along with the round of sanctions. The country can certainly deprive Russia of low- and high-tech goods made in the U.S. and other foreign countries, these include, commercial electronics, computers, semiconductors, aircraft parts, and other Western technology that is crucial to advance his military. This can be done by increasing the goods that require U.S. licenses. and before suppliers ship them, the administration may deny those licenses. Similarly, U.S. suppliers will also have to acquire a license for certain Russian goods like civil aircrafts.
The U.S. can also cut Russia off from the Western economy which is important for feeding its economy. “The key thing that President Putin needs to consider is whether he wants to ensure that Russia’s economy is able to grow, that he has the resources he needs to be able to project power in the future. If he chooses to invade, what we’re telling him very directly, is that we’re going to cut that off”, said Wally Adeyemo.
These measures are a part of a suite of export control penalties that show the U.S. is ready to damage Russia’s economy. This is subjected to be fine-tuned or changed as some White House Officials have pledged to spare the consumers of Russia from the penalties.
The key thing that President Putin needs to consider is whether he wants to ensure that Russia’s economy is able to grow, that he has the resources he needs to be able to project power in the future. If he chooses to invade, what we’re telling him very directly, is that we’re going to cut that off
The administration is also planning to hit Moscow with a cocktail of banking sanctions and export controls. Along with the U.S. countries like Japan and Britain are also in favor of slapping sanctions on Russia to punish the country.