The U.S. Treasury Department published a statement that explains some aspects of signed by President D.Trump law on sanctions against Russia and other countries on August 2. This is a very interesting document, which is able to make laugh any person who is not faced with the grotesque manifestations of law-abiding behavior of the U.S. middle class. The page with answers of OFAC (Department of Treasury responsible for the implementation of sanctions) on the most frequently asked questions is also particularly interesting.
For example, someone (perhaps, a poor farmer, who was tortured by annoying collectors) asked what to do with AK-47 and a tank T-34, as this Russian production had fallen under the sanctions. The answer in all seriousness explains whether you need to obtain an OFAC license, depending on where, when, how, and under what circumstances Russian production was purchased. Another person (maybe a businessman or a clerk periodically visiting our country) reasonably wondered whether he has the right to legally cross the border of the Russian Federation or to go to Russia from Belarus. According to this law, trips to Russia are not prohibited, but FSB has fallen under sanctions, i.e. any contact with this organization and its employees is prohibited. There is passport control at the airports, which is carried out by servicemen of the border troops, which are part of the FSB. OFAC explains how you should submit your passport to the Russian border guards, turn to them, and even answer their questions.
It is prohibited to conduct business with Russian companies in deepwater, Arctic, shale, pipeline, and energy projects, to finance without an OFAC license, export, re-export, providing technologies to relevant projects, not only in Russia but also in third countries. The law applies to projects that begin on 29 January 2018 or later.
After President Trump signed a law on anti-Russian sanctions, Russian media and expert community has started a discussion about possible counter-sanctions. Diametrically opposed and often exotic opinions were expressed: “It is foolish to shoot yourself in the foot,” “Let’s prohibit Coca-Cola in Russia.” After the publication of the U.S. Treasury statement, these discussions were resumed.
I remember an incident when, in November 2015, the Turkish jet fighter shot down the Russian SU-24 in Syria, and our pilot died tragically. Then our society almost unanimously approved sanctions against Ankara, though they caused an economic damage to both countries (a ban on charter flights, an embargo on the import of cheap Turkish tomatoes, etc.).
Such measures provide the state the moral authority and public trust. If the authorities behave as “economic animal” and guided only by considerations of financial and other material benefits, will its citizens risk their lives for the state in the future? If we leave the actions of the USA without an answer, it will show its authorities that they can continue to put pressure on Russia, tightening sanctions. In international relations, as well as in everyday life, the one who doesn’t answer blow for blow, loses credibility and provokes a “partner” for further beating.
We should admit that in economic relations the USA is guided by strong moral principles: its sanctions also hit the U.S. companies, which have already lost money and will lose even more, in case if they don’t participate in the Russian oil and gas projects. We can take the example from the Americans.
Of course, a lot of depends on the practical actions of the U.S. administration on the implementation of the law on sanctions after January 29. Obviously, our actions must be proportional and synchronized in time with the next steps of Washington.
Taking into account the incomparability of the economic potentials of Russia and the United States (US GDP to 18.6 trillion dollars, Russia GDP to 1.23 trillion dollars), our measures should not necessarily be symmetrical. The main thing – we shouldn’t violate international law, having defined “pain points” of the US economics and politics, which should be pushed to make a partner much more damage than ourselves.
A bill to ban the titanium supply for the American aviation industry (including production of military aircraft) and the Russian engines RD-180 and RD-181 supply, which are used in rockets Atlas V and Antares, has already discussed in the State Duma. These measures would impede the implementation of Boeing production plans and disrupted contracts for the supply of wide-body liners (we control 35% of the world market of Titan aircraft) and would have forced NASA to suspend the space program. The winner will be the Airbus Corporation and our reviving aircraft manufacturing industry (we are working together with China to create wide-body aircraft). The USA seeks to escape from dependence on Russia for rocket engines. Pratt & Whitney 20 has been trying to reproduce RD-180 for 20 years, but unsuccessfully. The company “Blue Origin” is developing a new engine BE-4, which should replace the RD-180 in 2020, but there are no any guarantees of success. According to the Wall Street Journal, the Pentagon will use the RD-180 much longer than it planned, and the ULA Company will continue to supply it with missiles until at least 2024.
Obviously Russia should envisage (if necessary) the termination of cooperation with the USA under the HEU-LEU contract (highly enriched uranium supply that provides up to 20% of the requirements of the American NPPs.) and ISS exploitation, an embargo on the purchase of American airliners, as well as the ban from flying over the territory of Russia. Of course, we also need to consider measures of damage compensation to Russian producers, including NGOs “Energomash”, producing rocket engines, and titanium manufacturer JSC “VSMPO-AVISMA”, and to speed up the negotiations on the supply of RD-180 in China.
Speaking about foreign policy, it would be useful to start negotiations with Tehran on cooperation in the field of rocket building. Of course, it should not violate UN Security Council resolution 2231 (appeal to Iran “not undertake any activity related to ballistic missiles intended to deliver nuclear weapons”), but to help Iran in the peaceful exploration of space. We can also intensify military-technical cooperation with Iran, including the supply of military technologies to protect the Strait of Hormuz, which can be used by the US Navy for aggression against Iran.
The package of the U.S. sanctions is personal. And we also need to “personify” our “counter-sanctions”, aiming them at those American legislators who were the initiators of the sanctions law. In particular, congressional democrats Nancy Pelosi, Steni Hoyer, Eliot Engel, Republican senators Bob Corker, Lindsey Graham, Ben Cardin, and of course the “best friend” of Russia Senator John McCain. The imposing of the ban on cooperation with companies registered in those districts from which these congressmen ran and with those companies that provided them with financial support, can affect the voters’ attitude to the politicians. We can adopt the U.S. practice of extraterritorial sanctions, for example we can envisage for restrictive measures (the inability to work in the market of the Russian Federation) in respect of those third countries, which will maintain business relationships with appropriate U.S. companies. GATT Article XXI (“Exceptions for reasons of national security”) allows us to do this without breaking WTO rules.
Maybe in this case, Washington will think about whether to continue to try to isolate Russia and to put pressure on it or it is better to solve problems through closer dialogue with it.