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In a coordinated action, the US, EU, UK, and Canada have imposed new sanctions on the eastern European state. However, experts are divided on just how impactful they will be.
An asset freeze has been imposed on ten Belarussian individuals and entities by the G7 members.
Sanctions programmes can inhibit financial institutions, including payment firms, from engaging in financial and other transactions connected with specified individuals, entities and countries, as well as activities that relate to certain geographic areas.
For example, in 2014, Visa and Mastercard were forced to block credit card services to selected Russian bank customers as a result of US sanctions.
“While the actions taken by the US, EU, UK and Canada were not identical, their coordinated release sends a strong message to the Belarusian government,” said Eric A. Sohn, publisher of MrWatchlist.
It also sends a warning to the Russian government, which has pledged its economic and political support, Sohn continued. “Minsk’s actions have significant consequences for international engagement with some of the world’s largest economies.”
That unity was underscored by the recent stopping and return of sales from BelAZ, the Belarusian heavy vehicle firm which attempted to export parts via Lithuanian Customs, according to Sohn.
“Compliance by countries with more to lose economically highlights the importance they place on enforcing the sanctions they have agreed to impose,” he said.
Others, however, were more sceptical as to how impactful the sanctions would end up being.
“We always need to be cautious when predicting the actual impact of such surgical sanctions measures,” said Nicolas Burnichon, associate at Hughes Hubbard.
It is worth noting that although the EU financial sanctions targeting certain transferable securities and money-market instruments adopted last June were wider than the one adopted last week by the US, their impact on EU financial institutions was quite discreet, he pointed out.
“These new U.S. financial restrictions are indeed quite limited as they are only targeting Belarusian sovereign debt with a maturity of greater than 90 days so EU financial institutions can largely maintain their relationships with the Ministry of Finance of Belarus and the Development Bank of the Republic of Belarus,” Burnichon argued.
According to the Paris-based lawyer, however, it is also important to underline that this fifth set of packages of sanctions from the EU and the US are targeting large state-owned Belarusian companies which are a substantial source of revenue for the Alexander Lukashenko regime, such as Belorusneft, BPC and Grodno Azot.
“This could have a significant impact on EU financial institutions having activities in Belarus,” he said.
Who has been sanctioned?
In a joint statement, the jurisdictions said: “We remain committed to supporting the democratic aspirations of the people of Belarus and stand together to impose costs on the regime – and those who support it – for its efforts to silence the voices of independent civil society, media and all Belarusians seeking to speak the truth about what is happening in their country.”
The sanctions, which have been put in place following the clampdown on dissent by the Lukashenko government after his disputed 2020 re-election as President. They target the following individuals:
- Ojsc Belaruskali
- Andrei Parshyn
- Sergey Alexandrovich Gusachenko
- Lyudmila Gladkaya
- Andrei Nikolaevich Mukovozchyk
- Andrey Evgenievich Krivosheyev
- Grigoriy Yurievich Azarenok
- Natalia Mikhailovna Buguk
- Alina Sergeevna Kasyanchyk
It represents the latest round of sanctions from US and European countries imposed over the past year.
The UK, for example, has already imposed sanctions on more than 100 people and organisations in response to what the Foreign, Commonwealth and Development Office has called “the fraudulent elections in Belarus and the litany of abhorrent acts and human rights violations that the Lukashenko regime continues to commit”.
“These sanctions continue to target important sources of revenue to the Lukashenko regime and place severe restrictions on those responsible for some of the worst anti-democratic acts in Belarus,” said UK foreign secretary Liz Truss in a statement.
