The Kremlin has issued a stark warning to Europe and the US, threatening “serious consequences” if Russian assets held abroad are seized to aid the Ukrainian budget and war effort. This warning comes as tensions continue to escalate between Russia and Western nations.
A spokesperson for Vladimir Putin told reporters that if the Biden administration and European leaders move forward with plans to seize over $300 billion of Russian central bank assets frozen after Moscow’s invasion of Ukraine in 2022, Russia will respond in kind. The New York Times reported that urgent discussions have begun among G7 nations on the unprecedented seizure of these funds, with the goal of using them to support the Ukrainian military effort or for reconstruction and budgetary use.
Russia’s threats of retaliation against Europe and the US come as tensions between the countries continue to mount. If the assets are seized, Russia has warned that it may consider tit-for-tat financial seizures or even a break in diplomatic relations. This warning has been met with concern, especially as European nations, such as Germany, have expressed a readiness to sign on to the strategy for potential asset seizures.
In response to the escalating situation, US President Joe Biden signed an executive decision to blacklist banks and other financial institutions that support Russian arms-making industries. This move is aimed at cutting off key components like semiconductors and machine tools needed for the Russian war machine.
The Ukrainian government has previously called on its supporters in the West to seize Russian assets to create a reconstruction fund for Ukraine. However, the legality of such a move has been questioned, with the Biden administration stating that it would require an act of Congress.
As tensions continue to rise, the threat of Russian asset seizures and potential diplomatic consequences looms large. The international community is closely monitoring developments as the situation between Russia and the West unfolds.