Russia continues to build up troops and flex its muscles on the borders with Ukraine. Despite harsh fear-mongering rhetoric in the global mainstream media, US officials seem to be quite aware that any Russian invasion of its neighbor, at least at this point, seems very improbable.
The US President Joe Biden announced an exit from Afghanistan and the very next day he placed sanctions on Moscow, expelling ten Russian diplomats and massively escalating the degradation of the US-Russia relations. He told Congress he is declaring a national emergency “with respect to the unusual and extraordinary threat to the national security, foreign policy, and economy of the US posed by specified harmful foreign activities of the Government of the Russian Federation”. At the same time, in testimony before a House of Representatives, American Air Force General Tod Wolters said there is a “low to medium” risk that Russia will invade Ukraine over the next few weeks.
The US imposed sanctions on Moscow nevertheless. The formal reason for such a decision was alleged Russian cyber-attacks and “other hostile acts”. The latest sanctions target 32 entities and officials accused of trying to influence the 2020 US presidential election “and other acts of disinformation”. In addition, ten Russian diplomats are being expelled from the United States. The executive order also bars the US financial institutions from purchasing rouble-denominated bonds from June. The punitive measures, however, do not target big Russian state companies in finance or energy, nor any powerful Russian oligarchs.
Russia’s response to American sanctions was rather moderate and limited. According to the Russian Foreign Ministry, ten US diplomats will be expelled from the country, and Moscow will ban US diplomatic facilities from hiring Russians and third-country citizens. In addition, Moscow will be banning the operations of US foundations working in Russia with the aim of meddling in the country’s domestic politics. Although Washington imposed financial sanctions on Russia, the Kremlin did not implement reciprocal measures. Thus, the Russian Federation is expected to keep buying US bonds. It is worth noting that Russia brought the volume of investments in US government securities to $6 billion in December 2020, according to the data of the US Treasury.
Russia also “responded” to the US sanctions by closing part of the Black Sea in the direction of the Kerch Strait until the end of October, but only for warships and state vessels of other countries. In other words, Ukrainian ports of Mariupol and Berdyansk in the Sea of Azov will not be cut off for civilian traffic, nor will the Russian “blockade” affect the Ukrainian economy. Moreover, on April 15 Kyiv started importing electricity from Russia – a country that is apparently preparing to invade Ukraine.
In spite of threats and sanctions, business ties not only between Russia and Ukraine, but also between Moscow and Washington, remain more or less intact. US companies such as Deloitte Touche and Marsh still operate in Russia, and there are no indications that they plan to leave the country. Moreover, the Kremlin keeps buying US dollars, even though Russian Foreign Minister Sergey Lavrov said in 2020 that Moscow “continues the policy of the economy’s de-dollarization”. It is worth noting that Lavrov recently suggested that Russia could abandon payments in US dollar. Even if such an action really takes place – which at this point does not seem very probable – it will unlikely happen before the US, as well as other countries, completely abandon currencies and go purely digital in a global blockchain system. In the meantime, Moscow and Washington are expected to keep doing business as usual.
Recently, Moscow hosted a summit on Afghanistan, and the US special representative Zalmay Khalilzad attended, even though Biden previously said that he believes his Russian counterpart Vladimir Putin is “a killer”. Indeed, Russia and the United States may act as bitter geopolitical rivals, but whenever they have a common interest, their partnership prevails. On April 13, the US President even held a phone call with the “killer Putin”, proposing a summit between the two leaders. Although they reportedly agreed to meet, the Kremlin later announced that Putin won’t meet with Biden in the near future. In other words, they will surely meet, but not just yet.
In the coming months, the two leaders are expected to hold their summit “on the neutral ground”. Where could that be? Although EU members Austria, Czech Republic, and Finland offered to host the meeting, there are speculations that Putin and Biden could meet in a country that is not in the EU, nor is a member of any military alliances. That country is Serbia – a place where the US Special Representative for Ukraine Kurt Volker and Russian presidential aide Vladislav Surkov already met in 2017 to discuss the Donbass conflict.
Until Putin and Biden meet – be it in the Serbian capital Belgrade or elsewhere – tension between Russia and Ukraine will likely remain very high. That, however, does not necessarily mean that Moscow and Kyiv will fight a major war. Dmytro Razumkov, speaker of the Ukrainian Parliament said that there is no reason for martial law in Ukraine, which clearly suggests that even Kyiv does not take Russian military performances on the border too seriously. Still, the show must go on, as well as the “new Cold War” narrative.
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