Liz Truss – 2022 Statement on Sanctions on Russia

The statement made by Liz Truss, the Foreign Secretary, in the House of Commons on 28 February 2022.

With permission, Mr Speaker, I wish to update the House on our support for Ukraine in the face of Putin’s premeditated, pre-planned and barbaric invasion. Ukraine has suffered horrific attacks. Missiles and air strikes have torn through apartment blocks. Tanks have rolled into once peaceful cities. Innocent people, including children, have lost their lives.

The situation is fluid, but as of today, Putin has not taken any major cities. The advance has been slowed by Ukraine’s fierce resistance. Putin’s invasion is not proceeding to plan. He expected to take cities quickly. He expected Ukraine to retreat. And he expected the West to be divided. Instead, his forces were met by the heroism of President Zelensky and the resolute determination of the Ukrainian people. He has been met by a united west, together with our friends around the world, and we have taken decisive action.

Today, we have acted with the US, the EU, Japan and Canada to cut off Russia’s central bank from our markets. The rouble has fallen by more than 40% as a result. As much as $250 billion has been wiped off the Russian stock market and, today, its stock market is closed. The EU, Germany, Sweden and others are following our lead in providing defensive weapons to Ukraine, and Germany has frozen Nord Stream 2.

Putin has been confounded by our collective response. That is why he is resorting to more and more extreme rhetoric. But, of course, the situation remains dire. The Government and people of Ukraine are facing a continued onslaught. The days ahead are likely to prove tougher still.

The UK and our allies will have to undergo some economic hardship as a result of our sanctions, but our hardships are nothing compared to those endured by the people of Ukraine. Casualty numbers are rising, and more than 300,000 people have already been displaced. This is a struggle for Ukraine’s freedom and self-determination, but it is also a struggle for freedom and democracy everywhere and for the survival of a Europe whole and free. We feel a particular responsibility as the UK is a signatory to the 1994 Budapest memorandum, which provided Ukraine with security guarantees.

This premeditated invasion, in violation of international law and multiple international commitments, cannot succeed. Putin must lose. We are doing everything that we can to stop him and to restore Ukraine’s sovereignty and territorial integrity. We will do this by backing Ukraine against unjustified aggression, by degrading the Russian economy and stopping it from funding Putin’s war machine, and by isolating Putin on the world stage.

First, we are backing Ukraine with defensive weapons, humanitarian aid and economic support. The UK was the first European nation to send defensive weapons to the country, and those weapons are being used today to halt Russian tanks and defend Ukrainian towns and cities. Our latest consignment of defensive support left Brize Norton over the weekend. We are also leading on humanitarian support. Yesterday, my right hon. Friend the Prime Minister announced a further £40 million of humanitarian aid, which will provide Ukrainians with access to basic necessities and vital medical supplies. We call on Russia to enable humanitarian access and safe passage for civilians to flee the violence. The UK is also supporting Ukraine’s economy, including through £100 million of official development assistance and guarantees of up to $500 million in development bank loans.

Secondly, we are cutting off funding for Putin’s war machine. We are coming together with the US, the G7 and the EU to take further decisive steps. We have been joined by Australia, Singapore, Switzerland and many more. There is a growing list of countries who are determined that this aggression cannot stand. We have agreed that many Russian banks will be removed from the SWIFT system, kicking them out of international finance. That is the first step towards a total SWIFT ban. Our collective action against Russia’s central bank will prevent it from deploying its international reserves to mitigate the impact of our sanctions.

We are also launching a joint taskforce to hunt down the assets of oligarchs hit by our sanctions. The UK is proud to lead by example. We have already put in place the largest package of sanctions in our history. We have sanctioned Putin and Lavrov, Russia’s defence industry and a growing list of oligarchs. We have approved asset freezes on several Russian banks and we are banning Russian airlines and private jets from our airspace, but we are determined to go much, much further. We want a situation where they cannot access their funds, their trade cannot flow, their ships cannot dock and their planes cannot land.

Today, I inform the House that I will be laying two new pieces of sanctions legislation. The first will introduce a set of new powers against Russia’s financial sector, including powers to prevent Russian banks from clearing payments in sterling. With over 50% of Russian trade denominated in dollars or sterling, our co-ordinated action with the United States will damage Russia’s ability to trade with the world, and as soon as this legislation comes into force, we will apply it to Sberbank—Russia’s largest bank.

I will also be imposing a full asset freeze on three further banks: VEB, Russia’s national development bank; Sovcombank, the third largest privately owned financial institution in Russia; and Otkritie, one of Russia’s largest commercial banks. We will bring in a full asset freeze on all Russian banks in days, looking to co-ordinate with our allies. The same legislation will prevent the Russian state from raising debt here, and will isolate all Russian companies—more than 3 million businesses—from accessing UK capital markets. Global giants such as Gazprom will no longer be able to issue debt or equity in London.

The second piece of legislation will ban exports to Russia across a range of critical sectors. This includes high-end technological equipment such as microelectronics and marine and navigation equipment. This will blunt Russia’s military-industrial capabilities and act as a drag on Russia’s economy for years to come. I appreciate the consequences of this step for British people and British businesses operating in Russia. The Department for International Trade and the Treasury will offer advice and guidance to affected UK businesses. My consular staff will continue to support British nationals in Russia, as well as those in Ukraine.

We will keep ratcheting up our response. More legislation will follow in the coming weeks, sanctioning Russian-occupied territories in the Donbas, extending more sanctions to Belarus, and limiting Russian deposits in UK banks. We will continue working through our hit list of oligarchs, focusing on their houses, their yachts, and every aspect of their lives. In addition, we will introduce the economic crime Bill tomorrow; my right hon. Friend the Business Secretary will set out more in the next statement in the House. This is all about flushing out the oligarchs’ dirty money from the United Kingdom. We will continue to work with our G7 allies to cut off the Russian economy and cut the free world’s dependence on Russian gas, depriving Putin of his key source of revenue.

Finally, we are leading the diplomatic effort to ensure that there is a chorus of condemnation against President Putin. In the Organisation for Security and Co-operation in Europe, a key part of the European security architecture, 45 countries condemned Russia by name. At the UN Security Council on Friday, more than 80 UN members voted for, or co-sponsored, a resolution condemning Russia’s aggression. Russia stood alone in opposing it. Putin is isolated. No one is willing to back his war of choice. In recent days, I have spoken to my counterparts in more than 20 countries around the world. Yesterday, I met G7 Foreign Ministers. We were joined by Ukraine’s brave Foreign Minister, my friend Dmytro Kuleba. Everyone is clear that Putin must lose, and we will carry on increasing the pressure until he does.

We have all seen Ukraine’s determination to fight. Putin’s war could end up lasting for months and years, so I say to our Ukrainian friends, “We are with you. In Britain, and around the world, we’re prepared to suffer economic sacrifices to support you. However long it takes, we will not rest until Ukraine’s sovereignty is restored.”

I commend this statement to the House.