European Commission: Sanctions vs. Russia may seriously affect European economy

Imposing economic sanctions against Russia may seriously hurt the European economy, according to Siim Kallas, interim European Commissioner for Economic and Monetary Affairs.

At a news conference devoted to the spring statistics forecast of the European Commission, Kallas said that they were thoroughly analyzing the possible consequences of imposing (trade and economic) sanctions on Russia. He noted that there were three possible scenarios, the worst of which envisioned serious losses to the European economy.

Nevertheless, the commissioner outlined that in case such sanctions against Russia are adopted, their impact on the economies of European countries would be unequal: some countries like Finland or Cyprus would be more exposed to negative effects, the others — to a lesser extent.

Italian businesses warn against economic sanctions vs. RussiaAccording to Kallas, in the context of sanctions, the European Commission is holding many discussions about EU’s energy dependence of Russia. However, he recalled that these talks are held since 2006, when Ukraine for the first time stopped transit of Russian natural gas to Europe. Kallas noted that EU countries not only abstain from considering any possibilities to impose penalties against Russia’s natural gas sector, but, on the contrary, fear that Russia might from its side go in for restricting gas supplies to Europe. “I don’t think that anyone [in Russia] may go for [natural gas] supplies’ restrictions. Russian state incomes to a wide extent consist of revenues from natural gas commerce,” the European commissioner believes.

Italian entrepreneurs and travel agencies doing business with Russia have urged their government and the European Union to take emergency diplomatic measures to stop bloodshed in Ukraine.

A 43-signature letter says Europe must bring events under control through political initiative. “It is first of all in the interest of Europeans to maintain peace and stability on our continent,” the letter says.

“The Russian Federation is a great country, with which we all maintain friendly relations, business and trade ties, as well as developing cultural exchanges. Speaking about a further tightening of sanctions against Russia is anachronism in the present stage of history when the economy in general, and not only supplies of energy resources, human contacts and lots of mixed marriages, will turn these sanctions first of all against Europeans themselves,” the letter adds.

“It is high time to abandon this attempt to return to Cold War times and unveil a new phase of European policy, independent and united, capable of becoming the leading force of a peace process,” the letter says. “Diplomatic efforts and dialogue among the interested parties is the only way out of the situation.”