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Currency, United States Finance

Europe achieves nothing but a new arms race with further sanctions against Russia, says VTB Bank CEO

The European Union has achieved nothing with sanctions against Russia and any extension to such measures from the bloc’s foreign ministers could lead to a new arms race, according to the chief executive of Russia’s VTB Bank.

“Did the west achieve anything with (previous) sanctions? Whether the world became a better place to live, whether we resolve the issue of Ukraine, whether both sides are better economically? I think the answer is no,” Andrey Kostin, president and chairman of Russia’s second-largest bank by assets, told CNBC on Tuesday.

Moscow is currently enduring the sharp end of tough international sanctions from Washington as a result of its annexation of Crimea and alleged part in the destabilization of eastern Ukraine.

On Monday, European foreign ministers announced they would prolong economic sanctions on the Black Sea peninsula, extending efforts to punish Moscow for its 2014 annexation of Crimea.

At a meeting in Luxembourg, the Council of the European Union said, “The EU continues to condemn the illegal annexation of Crimea and Sevastopol by the Russian Federation.”

EU sanctions have been extended and are now set to remain in place against Crimea until June 23 2018 at the earliest. Diplomats said they expected the bloc to do the same for its trade sanctions against Russia in due course.

“I think the relations between the West and Russia worsened substantially… we are now watching now how the new arms race can develop… definitely we see any further sanctions substantially worsening the atmosphere between the U.S. and Russia (as well as) Europe and Russia,” Kostin added.

On being challenged to provide evidence of a so-called arms race, Kostin argued that a breakdown in communications between both sides as well as actions from NATO to build up its defense close to the Russian border would prompt a “reciprocal answer” from the Kremlin.

Earlier this month, Russia scrambled a fighter jet to intercept a nuclear-capable U.S. B-52 strategic bomber it said was flying over the Baltic Sea near its border, according to a Reuters report.

Source: cnbc
Europe achieves nothing but a new arms race with further sanctions against Russia, says VTB Bank CEO

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