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Russia's retaliation to deepen isolation, damage economy - U.S. National Security Council

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Russia's retaliating against Western countries will deepen its international isolation and cause further damage to its own economy, the U.S. National Security Council's spokeswoman Laura Lucas Magnuson said on Wednesday.

She cited Russia's Central Bank as saying the import bans would accelerate the already high inflation and weaken Russian citizens' solvency.
Magnuson said Russia's actions in Ukraine and sanctions weakened its economy. Foreign investors stand aside from Russia, and Russian investors flee. Even before the sanctions, the outflow from the country was expected to amount to about 100 billion dollars in 2014, she said.
The United States continued to urge Russia to immediately take steps to de-escalate the conflict and stop attempts to destabilize the situation, she added.
Russian President Vladimir Putin decreed on August 6 to ban or limit agriculture imports from the countries that supported economic sanctions against Russia.
Last week, Russia banned the import of apples and some other fruit from Poland, saying this was because of sanitary concerns, but raising speculation that the move was in retaliation for Poland's support of the Ukrainian authorities.
Meanwhile, new U.S. sanctions targeting Russia's United Shipbuilding Corporation and oil industry came into force on Wednesday, August 6, said the U.S. Commerce Department's Industry and Security Bureau.
The United States announced the sanctions last week in connection with disagreements with Moscow over the situation in Ukraine.
The sanctions are imposed against the shipbuilding corporation based in St. Petersburg in a move that freezes any assets it may hold in the United States and prohibits all U.S. transactions with it.

The Commerce Department classified the corporation as a defence technology company.
The other target is the Russian energy sector. The Commerce Department said it will deny any export, re-export or foreign transfer of items for use in Russia's energy sector that may be used for exploration or production of deepwater, Arctic offshore or shale projects that have the potential to produce oil.
U.S. President Barack Obama also formally suspended credit that encourages exports to Russia and financing for economic development projects in the country.
Obama said the sanctions would have a "greater impact on the Russian economy than we've seen so far".
The targets of new U.S. sanctions also include VTB, Bank of Moscow and Russian Agriculture Bank, the U.S. Treasury said. The measures prohibit U.S. citizens or companies from dealing with debt carrying maturities longer than 90 days, or new equity.
Five of the six largest Russian state-owned banks are now under U.S. sanctions.
The U.S. administration announced the punitive measures on July 29.
Russia said U.S. sanctions were Washington's attempt at deflecting responsibility for its role in Ukraine where former Moscow-backed president Viktor Yanukovich was ousted and replaced with a pro-Western government.
"It is not Russia but the Kiev regime and its overseas patrons are guilty for the growing number of civilian casualties in the eastern regions," the foreign ministry statement said, referring to reports of civilian casualties in the violence.

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