A growing number of U.S. and European firms have chosen to voluntarily cease or suspend their operations in Russia. Are these firms’ managers deciding to divest to help Ukraine and punish Russia? Or are they divesting to help their own firms, under pressure from investors? Our results suggest the latter.
In this paper, we propose further financial sanctions to increase the cost to Russia’s invasion of Ukraine, based on further targeting two key vulnerabilities. The first targets Russia’s reliance on the U.S. Dollar and Western currencies as a reserve currency to back the Ruble. The second vulnerability is the Russian economy’s dependence on the Western financial system for a range of services.
In any negotiation, strong positioning is the most important factor. Assistance from Ukraine’s allies would give Ukraine, the victim, more bargaining power to reach an outcome that might be acceptable. Those who focus on Ukraine making territorial concessions or blame the United States for expanding the war only weaken Ukraine’s bargaining position.
Justifying their stay in Russia by “provision of essential goods” is a poor excuse. In reality, companies that claim this are protecting their market share.
Many commentators have written in the last few weeks that there is no solution to the Russia-Ukraine war other than diplomacy. No one is opposed to diplomacy. However, the key question is what kind of a diplomatic solution do we want to reach?
Through this paper, the working group aims to share its expertise and provide assistance to international efforts focused on the formulation of sanctions to increase the cost to Russia and support Ukraine in the defense of its territorial integrity and national sovereignty.
The West must maintain and step up the sanctions pressure on Russia in order to persuade the Kremlin that it must end its war against Ukraine. The working group applauds the EU’s decision to impose a 6th package of sanctions to sustain pressure on the Russian economy, reducing the regime’s ability to wage war in Ukraine.
There are many discussions on the reconstruction of Ukraine underway and even a few specific plans, such as the one proposed by the European Commission. So