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Russia Warns That U.S. Sanctions Banning Banks Would Be 'Economic War'

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Russian Prime Minister Dmitry Medvedev says that Moscow would consider it a "declaration of economic war" and would retaliate "economically, politically, or, if needed, by other means" if the United States imposes bans on Russian banks or their use of a particular currency, reported Radio Free Europe (US).

Medvedev's tough talk on August 10 came after the United States announced a new round of sanctions and U.S. lawmakers proposed further measures, including restrictions on the operations of several state-owned Russian banks and curbs on their use of the U.S. dollar.

While he did not go into detail, Medvedev's reference to "other means" appeared to have been aimed to raise the prospect that Russia could respond with military force or some other form of warfare, such as a cyberattack.

"I would not like to comment on talk about future sanctions, but I can say one thing: If something like a ban on the operations of banks or on the one currency or another follows, it would be possible to completely directly call it a declaration of economic war," Medvedev said during a visit to the Kamchatka Peninsula in the Russian Far East.

"And it would be necessary...to react to this war economically, politically, or, if needed, by other means," he said. "And our American friends need to understand this."

'Sanctions Bill From Hell'
The potential sanctions Medvedev was referring to were proposed in draft legislation introduced on August 2 by a bipartisan group of senators including Republican Senator Lindsay Graham, who said its proponents want to "impose crushing sanctions and other measures against [President Vladimir] Putin’s Russia until he ceases and desists meddling in the U.S. electoral process, halts cyberattacks on U.S. infrastructure, removes Russia from Ukraine, and ceases efforts to create chaos in Syria.”

The prospects for passage of what Graham called the "sanctions bill from hell" is uncertain.

The full U.S. Congress will not be back in Washington until September, and the Reuters news agency cited congressional aides as saying they do not expect the measure to pass in its entirety.

The aides said that, while it is hard to predict weeks in advance, it is more likely that some of its provisions would be included as amendments in another piece of legislation, such as a spending bill that Congress must pass before September 30 to avoid a government shutdown.

A week after it was introduced, the Defending American Security from Kremlin Aggression Act (DASKAA) of 2018 made waves again on August 8 when the Russian daily Kommersant published what it said was the full text of the legislation.

The Russian ruble dropped sharply after the publication. It fell again on August 9, reaching a two-year low, after the U.S. State Department announced that new sanctions will be imposed on Russia over the poisoning of former Russian spy Sergei Skripal and his daughter in England in March, in what Britain, the United States, and others say was an Russian attack using a Soviet-designed nerve agent known as Novichok.

The first set of sanctions covered by that announcement, which U.S. officials said target export licenses of sensitive U.S. technologies and industrial equipment, such as electronics, calibration equipment, and gas turbine engines, are expected to enter into force around August 22.

A second set of measures could be substantially broader and would be imposed if Moscow fails to meet a 90-day deadline to provide “reliable assurances” it will no longer use chemical weapons, allow on-site inspections by the UN or other international observer groups, and respond to other U.S. demands.

Kremlin spokesman Dmitry Peskov called the new sanctions "categorically unacceptable" and "illegal."

Russian Foreign Ministry spokeswoman Maria Zakharova accused the United States of trying to "demonize" Russia and said Moscow would be preparing a response to "this unfriendly act," but did not elaborate.

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Russian President Vladimir Putin and the permanent members of the national Security Council have discussed new possible US sanctions against Moscow, Kremlin Spokesman Dmitry Peskov said, reported TASS (Russia).

According to him, "there was a discussion of new unfriendly steps on the part of Washington, which may take the form of trade restrictions." The meeting’s participants "emphasized the complete illegitimacy of such actions from the standpoint of international law," Peskov added.

The meeting also "discussed routine issues concerning the country’s social and economic development."

The meeting involved Russian State Duma (lower house of parliament) Speaker Vyacheslav Volodin, Kremlin Administration Head Anton Vaino, Security Council Secretary Nikolai Patrushev, Defense Minister Sergei Shoigu, Federal Security Service (FSB) Director Alexander Bortnikov.

The US Department of State said in a statement that Washington was imposing new sanctions on Moscow over its alleged involvement in the poisoning of Sergei and Yulia Skripal in the British city of Salisbury. The first round of sanctions will take effect on August 22, while a second round may be introduced in 90 days in case Russia fails to meet certain conditions, the State Department said. Moscow has on numerous occasions rejected all the allegations about its involvement in the Salisbury incident.

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