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Thursday, February 22, 2024

Pressure Mounts on EU to Impose Sanctions on Russian Aluminum

Four EU nations are urging the bloc to impose an embargo on inexpensive metal imports from Russia, forming part of anticipated sanctions marking the second anniversary of the Ukraine invasion.

Despite ongoing efforts, Europe continues to acquire 9 percent of its aluminum imports from Russia, contributing around €2.3 billion to Moscow’s war efforts in 2022. While a complete ban may not materialize by the invasion’s two-year mark on Feb. 24, Lithuania’s proposal, backed by Estonia, Latvia, and Poland, faces resistance from industrial nations like Italy, concerned about potential price hikes.

The EU aims to present its 13th sanctions package by the deadline, but the considerable volume of Russian imports suggests unanimous approval for a total ban is unlikely. While grappling with elevated energy costs and foreign competition, European aluminum producers are hopeful that sanctions against Russia, the world’s third-largest producer, will offer relief.

Despite support from the four EU nations, negotiations among the 27 member countries remain crucial as the industry seeks a decisive shift away from Russian imports.

Tactical bomb

European industrial consumers are actively opposing sanctions on aluminum, arguing that such measures would act as an “economic tactical nuclear bomb,” according to FACE, an EU grouping representing industrial consumers. In December, this coalition, speaking on behalf of Italian, German, and other EU manufacturing industries, emphasized that “sanctions should not be weaponized.”

Speaking anonymously to POLITICO over the weekend, two EU diplomats disclosed that the upcoming sanctions package is expected to primarily involve new listings of individuals and the prohibition of additional companies from exporting dual-use goods and battlefield products to Russia. The diplomats cited the tight timeline as a factor, asserting that focusing on existing measures and ensuring timely approval is crucial.

Also Read: Ukraine Drains Russian Vehicles, Kremlin’s Arsenal at Risk in Six Months

One of the diplomats remarked, “The timeline is too short for something bigger,” emphasizing the importance of finalizing the package on schedule and highlighting recent EU actions in support of Ukraine. While sanctions were not discussed during the recent special European Council meeting, a third senior EU diplomat suggested that this omission might have been intentional.

Referring to the weekend’s ‘confessionals,’ where groups of EU envoys exchange ideas, the diplomat noted, “Maybe that’s why they put the confessionals just after EUCO,” implying that discussing sanctions immediately after celebrating €50 billion in support could help temper the ambitions of less proactive governments regarding the 13th sanctions package.

They would argue that it is better to reach an agreement for symbolism rather than having nothing at all due to prolonged negotiations. The third diplomat emphasized, “We still don’t buy it and will move for more ambition.”

The top envoys of all EU countries are scheduled to discuss the package this Thursday.

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