29 July 2014
Last updated at 21:44
US President Barack Obama has announced new economic sanctions against Russia, saying they will make Russia’s “weak economy even weaker”.
He said the co-ordinated actions of the US and European Union would “have an even bigger bite” on Russia’s economy.
The new restrictions include banning Americans or people in the US from banking with three Russian banks.
The aim is to increase the cost to Russia of its continued support for pro-Moscow rebels in eastern Ukraine.
Moscow denies charges by the EU and US that it is supplying heavy weapons to the rebels.
President Putin has urged the Russian defence sector to rely less on foreign components
Speaking at the White House, Mr Obama said the US was widening its sanctions to target the key sectors of the Russian economy – energy, arms, and finance.
“If Russia continues on this current path, the costs on Russia will continue to grow,” Mr Obama said.
The US Treasury said the banks being targeting in this round of sanctions were VTB, the Bank of Moscow, and the Russian Agriculture Bank (Rosselkhozbank).
Earlier, the EU also adopted new economic sanctions against Russia, targeting the oil sector, defence equipment and sensitive technologies.
Full details of the new EU sanctions are expected on Wednesday, when the EU is also set to name more Russian officials facing asset freezes and travel bans in Europe.
German Chancellor Angela Merkel, who had been reluctant to step up sanctions because of Germany’s trade links with Russia, said the latest measures were “unavoidable”.
Calls for the EU to act have been fuelled by the downing of flight MH17 over eastern Ukraine. All 298 people on the Malaysia Airlines jet were killed, many of them Dutch citizens.
An international team has again failed to access the crash site, amid heavy fighting between government forces and rebels there.
Western governments believe the pro-Russian separatists shot the plane down on 17 July with a Russian missile, believing it to be a Ukrainian military flight. The rebels and Moscow deny that, instead blaming the Ukrainian military.
Kerry plea to Russia
Speaking in Washington, US Secretary of State John Kerry urged Russia and the rebels to give Western investigators full access to the crash site.
“They still can’t even ensure that all of the victims’ remains have been removed, and that is an unsupportable burden for any family to have to bear, and it is an unacceptable standard for behaviour, period,” he said.
“The site has to be cordoned off, the evidence has to be preserved, and Russia needs to use its considerable influence among the separatists in order to be able to help ensure this basic approach of common decency.”
Ukrainian troops are continuing an offensive aimed at encircling the rebels in Donetsk region. In the latest developments:
- Several shells are said to have struck buildings in the separatist stronghold of Donetsk city
- Ukraine says its troops have entered the towns of Shakhtarsk and Torez in Donetsk region, and Lutuhyne in Luhansk region
- Ten Ukrainian soldiers and at least 22 civilians have reportedly been killed in the last 24 hours
- The dead civilians are said to include three children and five people at a home for the elderly
- A group of hackers sympathetic to the rebels says it has disabled the website of the Ukrainian president.
Analysis by BBC Europe editor Gavin Hewitt
Europe’s leaders did not want to move to economic sanctions but they were moved by two considerations: the outrage at the way investigators have been blocked from access to the crash site of the downed plane and, secondly, the fact that Russia, since the incident, has been allowing heavy weapons across the border into Ukraine.
The calculation in Europe is that it had to act for its own credibility and that it may have to go further to ensure that President Vladimir Putin and his inner circle understand that their actions carry consequences.
How will Russia respond? Hard to say, although Foreign Minister Sergei Lavrov said Russia would not retaliate or “fall into hysterics”.
Ukraine conflict: EU squeezes Russia
Last weekend, the EU subjected a further 15 Russian individuals and 18 entities to asset freezes and visa bans for their alleged involvement in the Ukraine conflict.
The list of 87 targets of EU sanctions now includes the heads of the Federal Security Service (FSB) and foreign intelligence, the president of Chechnya, as well as two Crimean energy firms.
However, UK company BP, which owns nearly 20% of Russian state oil giant Rosneft, has warned that further sanctions against Russia could “adversely impact” its performance.