MOSCOW, July 30 (RIA Novosti) – The third phase of EU penalties on Russia will eventually backfire, and the fact that the new economic sanctions are less harsh than Washington wanted them to be indicates that the 28 European nations are well aware of this impact, an expert with the Center for European Policy Studies in Brussels said Wednesday.
“Of course, given the economic interconnectedness, there will also be an economic impact on the European Union,” Hrant Kostanyan said. “This depends on the area of the sanctions. There is also geographic proximity. Sanctions could have been much harsher. They aren’t that harsh. This is being done gradually.”
Brussels has apparently strong-armed national governments into slapping Russia with sanctions that target the key sectors of the country’s economy - energy, arms and finance – despite their putting up resistance in the previous months.
“Given the differences between EU member states on how far to go in the sanctions, there isn’t a great deal of support for full-scale economic area sanctions,” Kostanyan pointed out.
According to preliminary estimates, these sanctions may cost the bloc up to $133 billion in trade. Volker Treier, the head of German Chamber of Industry and Commerce (DIHK), said earlier that restrictions on trade with Russia have already hit one in four German export companies, with the country’s Committee on Eastern European Economic Relations predicting a loss of 350,000 jobs.
To make matters worse for Brussels, Russia supplies about 30 percent of Europe's gas. Earlier today, the Russian Foreign Ministry warned that stiffer penalties against Russia’s energy sector will drive up European energy prices and hurt the bloc no less than Russia.
Russian and EU economies are “communicating vessels," the ministry said, and Brussels' decision to move to third-phase sanctions against Moscow will affect all economies in the region.
