The Russian economy is growing faster than those of Western countries, the chair of the Treasury Select Committee has admitted
Harriet Baldwin MP © Oli Scarff – WPA Pool/Getty Images
A senior British MP and chair of the Treasury Select Committee has admitted that sanctions on Russia are not working, as the country’s economy is growing faster than many of those in the West.
Harriet Baldwin told the Financial Times on Monday that sanctions had failed to weaken Russia as Moscow had found ways to work around them.
“There’s a general consensus that sanctions are not working in terms of their stated intent – causing real trouble for the Russian economy,” she said.
The MP referred to the latest forecast issued earlier this month by the International Monetary Fund (IMF). It predicted that Russia’s economy would grow by 3.2% this year – more than the US, the UK, Germany and France.
Baldwin chairs the Treasury committee tasked with investigating whether the UK’s program of economic sanctions has succeeded in reducing Moscow’s export revenues. It launched an inquiry into the matter in February, and MPs are expected to hold oral evidence sessions on Tuesday.
The committee has already received written evidence which, according to the FT, indicates that “a more robust approach” is needed towards sanctions evasion. The inquiry is due to report on its findings in July.
Britain, along with the US and the European Union, launched an unprecedented sanctions campaign against Russia in 2022 after the start of Moscow’s special military operation in Ukraine. The Western nations targeted Russia’s financial and industrial sectors, banning or restricting trade in raw materials and energy resources that provide the bulk of Russia’s export revenues. Baldwin pointed out that some of the restrictions are more than two years old.
“The longer sanctions are in place, the more ways people find to get around them, and it’s pretty obvious that patterns of trade are changing to allow exactly that,” she said.
London banned imports of Russian oil products in December 2022. However, a loophole in the legislation has allowed the UK to continue buying Russian oil. The Guardian reported last week that Britain’s imports of refined oil from India, China and Turkey – which Moscow supplies with crude – have increased dramatically over the past two years. Russian oil refined in another country is no longer considered to have originated in Russia, allowing it to avoid the trade ban, the newspaper explained.
Moscow has repeatedly said that it has adapted to Western sanctions on its critical industries and has become more self-sufficient. High oil prices have allowed Russia to maintain robust oil export revenues.
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