“There’s a package for you!” The West is gearing up for new restrictions against Russia and Belarus

As we approach the second anniversary of the Russian invasion of Ukraine, the West is preparing for another round of sanctions. Currently, Belarus is indirectly affected, with only the Baltic countries and Poland pushing for synchronized sectoral restrictions against both Russia and Belarus. However, a potential surge in repression against civil society in Belarus might speed up the enforcement of measures against the Lukashenka regime.

The EU is working on its 13th package of sanctions against Russia, expected to be approved in February, just before the second anniversary of the invasion. The package aims to expand the list of individuals and entities responsible for the aggression, subjecting them to asset freezes and entry bans to the European Union. Additionally, the package is set to strengthen trade restrictions and measures to counter potential sanctions evasion.

However, it’s unlikely that the upcoming sanctions will include restrictions on importing Russian aluminum, a demand from Poland and the Baltic countries. Other points may also see some flexibility, as previous attempts to limit exports of Russian nuclear fuel and liquefied natural gas faced challenges due to a lack of consensus among EU member states. Some Eastern EU countries, like Hungary, opposed sanctions on the nuclear industry, while Germany and others were against restrictions on liquefied natural gas.

Also, in commemoration of the second anniversary of the Russian aggression, Brussels is working on an agreement to allocate €50 billion to Kyiv over the next four years. Notably, a portion of these funds may be disbursed immediately upon approval of the document. Additionally, an extra €5 billion in military aid annually and the transfer of profits from Russia’s frozen assets will be included in the overall support package. Most likely, all the net profit from investing Russian assets, minus expenses and national taxes, will be directed towards aiding Ukraine. While the total amount of profit remains undisclosed, the largest holder of Russian assets, the Belgian depository Euroclear (accounting for €191 billion), earned €2.2 billion from them in the first nine months of 2023.

Since the end of last year, the White House has been pushing for a complete confiscation of funds from the Russian Central Bank (with the United States itself accounting for only USD 5 billion of seized Russian assets). This idea gained traction in Washington after both the US Congress and EU countries failed to approve multibillion-dollar aid packages for Ukraine. However, EU authorities are wary of such radical measures, as seizing sovereign assets could result in a sharp loss of confidence in the European financial system and the euro. It may also prompt similar actions by the Kremlin against Western assets in Russia.

Meanwhile, the Baltic countries and Poland advocate for aligning sectoral sanctions against Belarus with those against Russia. The Allies also plan to tighten controls on goods subject to export bans and restrictions that are shipped to third countries through Russia and/or Belarus. For instance, the State Revenue Service of Latvia (VID) has initiated over 250 criminal cases for violating sanctions against Belarus and Russia. In 2022, 114 cases were processed, and in 2023, 144. The most common goods people try to import into Belarus and Russia in violation of sanctions include electrical goods, electrical equipment, network equipment, auto parts, and luxury goods. Conversely, attempts to export wood products, fuel, feed, and metal products from Russia and Belarus are also frequently observed.

The Lithuanian Foreign Ministry proposes extending restrictions for citizens of Belarus and Russia for another year, with strengthened border controls expected for Belarusians.

On the other hand, the Polish Foreign Ministry believes that a new wave of repression in Belarus should prompt the adoption of a new package of sanctions against the Belarusian authorities. EU’s Josep Borrell and the US State Department have also condemned the new wave of repression, with Washington committing to continue sanctions pressure on the Belarusian authorities.