The European Union would target state-owned Russian banks vital to
financing Moscow's faltering economy in the most serious sanctions so
far over the Ukraine crisis under proposals considered by EU governments
on Thursday.
Ambassadors of the 28-nation bloc discussed options to curb Russian access to capital markets, arms and energy technology in response to the downing of a Malaysian airliner in an area of eastern Ukraine held by Russian-backed separatists on July 17.
Talks on the options for stepped-up action drafted by the European Commission will continue on Friday morning, an EU official said, and diplomats said decisions on wider sanctions were likely at the earliest next week.
However, the ambassadors did agree to add more people and entities to the EU's asset freeze list, using expanded criteria including Russian companies that help to undermine Ukraine's sovereignty.
The names will not be published until late Friday but diplomats said it concerned 15 individuals and 18 entities, half of which were companies.
Ambassadors also agreed to further expand the scope of sanctions to include companies and people who support Russian decision-makers responsible for the annexation of Ukraine's Crimea region or for destabilising eastern Ukraine.
Under one key proposal, European investors would be banned from buying new debt or shares of banks owned 50 percent or more by the state. These banks raised almost half their 15.8 billion euro ($21.29 billion) capital needs on EU markets last year.
"If implemented such sanctions would be a serious blow to the Russian economy, exacerbating an already very likely recession this year and sustaining an economic depression for longer," said analyst Michal Dybula of BNP Paribas.
The proposals included an arms embargo, although diplomats said it would apply to future deals and would not bar delivery of a French warship built for Russia under a 2011 contract.
The EU was also weighing restricting exports of technology for deep-sea drilling, shale and Arctic energy exploration and so-called civilian-military "dual use" items, diplomats said.
After months of hesitation, powerful EU states including Germany, Moscow's biggest trade partner, are pushing for quick action as they believe Russia has consistently failed to meet international demands to end violence in Ukraine.
Read more: EU targets state-owned Russia banks in sanctions plan | Economy | Worldbulletin News
Ambassadors of the 28-nation bloc discussed options to curb Russian access to capital markets, arms and energy technology in response to the downing of a Malaysian airliner in an area of eastern Ukraine held by Russian-backed separatists on July 17.
Talks on the options for stepped-up action drafted by the European Commission will continue on Friday morning, an EU official said, and diplomats said decisions on wider sanctions were likely at the earliest next week.
However, the ambassadors did agree to add more people and entities to the EU's asset freeze list, using expanded criteria including Russian companies that help to undermine Ukraine's sovereignty.
The names will not be published until late Friday but diplomats said it concerned 15 individuals and 18 entities, half of which were companies.
Ambassadors also agreed to further expand the scope of sanctions to include companies and people who support Russian decision-makers responsible for the annexation of Ukraine's Crimea region or for destabilising eastern Ukraine.
Under one key proposal, European investors would be banned from buying new debt or shares of banks owned 50 percent or more by the state. These banks raised almost half their 15.8 billion euro ($21.29 billion) capital needs on EU markets last year.
"If implemented such sanctions would be a serious blow to the Russian economy, exacerbating an already very likely recession this year and sustaining an economic depression for longer," said analyst Michal Dybula of BNP Paribas.
The proposals included an arms embargo, although diplomats said it would apply to future deals and would not bar delivery of a French warship built for Russia under a 2011 contract.
The EU was also weighing restricting exports of technology for deep-sea drilling, shale and Arctic energy exploration and so-called civilian-military "dual use" items, diplomats said.
After months of hesitation, powerful EU states including Germany, Moscow's biggest trade partner, are pushing for quick action as they believe Russia has consistently failed to meet international demands to end violence in Ukraine.
Read more: EU targets state-owned Russia banks in sanctions plan | Economy | Worldbulletin News
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