Borrell: ‘Moscow will have to choose either butter or guns’

Borrell: ‘Moscow will have to choose either butter or guns’

July 6, 2022

In an article published in the French newspaper ‘Le Journal du Dimanche’, the EU High Representative Josep Borrell said the sanctions against Russia, implemented after the start of the full-scale aggression against Ukraine are already hitting Vladimir Putin and his accomplices hard, and their impact on the Russian economy will intensify over time. 

Borrell explains why and how Western sanctions against Russia are more effective than most people think. Although Russia exports a lot of raw materials, it also has no choice but to import many high value-added products that it does not manufacture. For all advanced technology, it is 45% dependent on Europe, 21% on the United States, and only 11% on China. 

In the military field, which is crucial in the context of the war in Ukraine, the sanctions limit Russia’s capacity to produce precision missiles, such as the Iskander or the KH 101, says Borrell. He also mentions that almost all foreign car manufacturers have decided to withdraw from Russia and the few cars produced by Russian manufacturers will be sold without airbags or automatic transmission. 

The oil industry is suffering not only from the departure of foreign operators but also from the difficulty of accessing advanced technologies such as horizontal drilling,” says the EU high official. “The ability of the Russian industry to bring new wells on stream is likely to be limited. Finally, in order to maintain air traffic, Russia will have to withdraw the majority of its aircrafts from circulation in order to recover the spare parts needed to allow the others to fly. Added to this there is also the loss of access to financial markets, being disconnected from major global research networks and a massive brain drain.”

Borrell also notes that China, contrary to expectations, offers a limited alternative for the Russian economy, especially for high-tech products, because, to date, the Chinese government has not assisted Russia in circumventing Western sanctions. 

Will these significant and growing impacts lead Vladimir Putin to modify his strategic calculations? Probably not in the immediate future: his actions are not guided primarily by economic logic. However, by forcing him to choose either butter or guns, the sanctions lock him in a vice that is gradually tightening,” concludes Josep Borrell.

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