EU set to join UK, Canada, US and Japan by banning imports of Russian gold

The European Commission (EC) has set out plans to introduce a new import ban on Russian gold to align with the announcement last month that the UK, Canada, US and Japan would do so in an attempt to stem funding for Moscow’s invasion of the Ukraine.

Gold is a major Russian export, worth US$15 billion to the Russian economy in 2021. Its value to the Russian elite may also have increased in recent months, with oligarchs reportedly buying gold bullion in an attempt to avoid the financial impact of sanctions.

EU package

The commission says it will introduce a package that, as well as imposing an import ban on Russian gold, will reinforce European dual use and advanced technology export controls and strengthen reporting requirements to tighten EU asset freezes.

Current EU sanctions are expected to remain for six months until the next review at the end of January 2023. The commission’s package will now be discussed by EU member states in view of its adoption.

Response to criticism

In an apparent response to criticisms that they are hindering international trade in grain and food, the package is expected to reiterate that EU sanctions do not target in any way the trade in agricultural products between third countries and Russia.

For the same reason, the package is expected to clarify the exact scope of some current financial and economic sanctions.

London gold hub

In 2019, some 90 per cent of Russian gold exports went to the UK. London is a major global gold trading hub and UK sanctions, which will be the first of their kind to be implemented against Russia anywhere in the world, aim to have a huge impact on Moscow’s ability to raise funds.

With  parallel US, Japanese and Canadian action, the measures introduced by the four countries will have global reach and aim to shut Russian gold out of formal international markets.

 



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