The President of the European Commission, Ursula von der Leyen, officially announced the introduction of the fifth package of sanctions on Russia. It consists of six pillars aiming at cutting off an essential source of Russian income.
Firstly, the EU bans coal imports worth €4.4 billion annually from Russia. According to the European Commission website, The EU depends on Russia for around 45% of its coal imports. Almost 70% of its thermal coal comes from Russia, which is used in power and heat generation, according to Brussels-based thinktank Bruegel. Germany, Poland and the Netherlands are Europe's biggest consumers of Russian coal. European governments consider using Australian, South African and Canadian coal instead.
Secondly, the EU banned transactions in four key Russian banks, including VTB, Russia's second-largest bank. These four banks, which we are now completely cut off from the markets, represent a 23 percent share of the Russian banking sector.
Third: a ban on entry to EU ports for Russian and Russian-operated ships. Some exceptions will be made for essential commodities such as agricultural and food products, humanitarian aid, and energy. In addition, the European Commission is working on a ban on Russian and Belarusian road carriers. This ban aims to " drastically reduce the Russian industry's ability to source key goods," reads the announcement.
Fourth: further targeted export bans, worth €10 billion, in areas sensitive to Russia. This includes quantum computers and advanced semiconductors, as well as sensitive machinery and transportation equipment. EU arguments that this step will help continue to degrade Russia's technological base and industrial capabilities.
Fifth: new bans on imports of certain products - from wood to cement, seafood to alcohol - worth €5.5 billion, designed to cut off Russia and its oligarchs from the money stream. This measure is thought to close the legal gaps between Russia and Belarus.
Sixth: in her announcement, Ursula von der Leyen also announced "taking several very targeted measures, such as a general EU ban on the participation of Russian companies in public procurement in member states or the exclusion of all financial support, whether European or national, to Russian public institutions. Because European tax money should not go to Russia in any shape or form".
The President of the European Commission declared taking further measures aimed at oil imports, taxes, or special payment channels such as the escrow account. As of now, more than 40 countries currently have such sanctions in place.
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