Russia faces EU funding cuts, more freezing of assets

Agreed-upon loans will be suspended and sanctions will widen.
By Ed Adamczyk   |   July 16, 2014 at 12:52 PM   |   Comments

BRUSSELS, July 16 (UPI) -- The European Union will increase sanctions and stop large-scale funding to Russia in response to support of Ukrainian separatists.

The EU's bank, the European Investment Bank, and the European Bank for Reconstruction and Development, will suspend financing of Russian public-sector projects. It will cut Russia off from a loan of one billion euros ($1.35 billion) promised by the EIB and additional funding from the EBRD, which loaned Russia 1.8 billion euros ($2.43 billion) in 2013.

Under consideration is the suspension of other EU programs designed to provide Russia with an additional 450 million euros ($608.8 million) between 2014 and 2020.

The plans were contained in a draft of a statement of an EU summit meeting Wednesday.

Wider asset freezes of organizations that "are supporting, materially or financially, actions undermining or threatening Ukraine's sovereignty, territorial integrity and independence" as the statement phrased the situation, are also expected. It added Russian measures to reduce the violence in Ukraine "have not been met."

European nations are being urged by the United States to take a stronger stand against Russia, and additional U.S. sanctions against Russia's defense and financial sectors are imminent, official sources said.

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