US Treasury imposes economic costs in response to Donetsk and Luhansk action

Article summary

The US Department of the Treasury has taken action to respond to President Vladimir Putin’s decision to recognise Donetsk and Luhansk People’s Republics (DNR and LNR) as 'independent' states and deploy troops imposing additional restrictions on Russian sovereign debt and sanctioning Kremlin-connected elites. The US Treasury has placed severe restrictions on economic activity with DNR and LNR. This action is expected to target Russia’s ability to finance aggression against Ukraine by sanctioning the Corporate Bank for Development and Foreign Economic Affairs Vnesheconombank and Promsvyazbank Public Joint Stock Company. Consequently, Russia’s ability to finance defense-related contracts and raise funds to finance the campaign against Ukraine will be constrained.