The UK is ready to escalate sanctions against Russia in the event of a full invasion of Ukraine, the foreign secretary has said.
Liz Truss defended criticisms of measures announced by the government on Tuesday, describing them as “severe”.
She said it was important to keep further sanctions “in the locker”.
Russian President Vladimir Putin has ordered troops to be sent into two Ukrainian regions held by Russian-backed separatists.
On Tuesday Prime Minister Boris Johnson announced sanctions against Russia in response, with five banks having their assets frozen, along with those of three Russian billionaires – who will also be hit with UK travel bans.
But a number of MPs, including some Conservatives, have called for tougher measures, with shadow foreign secretary David Lammy saying the “mood of the entire House of Commons was that the government wasn’t being strong enough”.
Downing Street will hold a summit later with finance chiefs and regulators to discuss how to make sanctions effective.
It is also anticipated that Mr Johnson will outline more military support for Ukraine later today.
‘Turning up the heat’
Speaking to BBC Breakfast, Ms Truss said the sanctions were the most severe the UK had ever placed on Russia.
“The sanctions we’re putting in place are coordinated with the United States, they’re coordinated with Europe, to make sure that Vladimir Putin cannot play divide and rule amongst the allies.
“We’ve shown we are united and we will escalate those sanctions in the event of a full invasion into Ukraine.”
She also defended donations made by Russians to the Conservative Party, saying every donation had to be fully declared and donors were required to be on the electoral register.
Ms Truss said: “I think we’ve got to be very careful to distinguish between those who are supporters of the regime, those who are propping up Vladimir Putin and those people who may have moved from Russia years ago and who are part of the British political system.”
Ms Truss was shown a picture from May 2019 which showed her, former prime minister Theresa May and other cabinet ministers at the time with Lubov Chernukhin, the wife of a former Russian minister who has been financially linked to people who were close to the Kremlin.
Mrs Chernukhin has been one of the Conservative Party’s biggest donors. Her lawyers say the donations are not tainted by Kremlin influence.
Asked if she was embarrassed by the picture, Ms Truss said “no, I’m not”.
The foreign secretary said the government would target “without prejudice” anybody who is helping “prop up Vladimir Putin’s appalling regime”.
She also reiterated comments made by Mr Johnson that football’s Champions League final should no longer be held in St Petersburg.
“I think it is wrong at this stage with what Russia is doing internationally to have the final there,” Ms Truss said.
Has the UK gone far enough?
At the start of this month, Prime Minister Boris Johnson warned Russia the UK was “preparing a package of sanctions and other measures to be enacted the moment the first Russian toe cap crosses further into Ukrainian territory”.
Fast forward to today – and the view in London is very much that toe-caps have crossed that threshold.
The prime minister believes an invasion is under way, even if Downing Street says it’s not a full-scale one yet and is still urging Russia to stand back from the brink.
So, has the UK followed through on its threats about sanctions?
Writing in the Times, Ms Truss said the government has a “long list of those complicit in the actions of the Russian leadership”, adding that if Mr Putin refuses to pull back troops, the UK can “keep turning up the heat” by targeting more banks, wealthy individuals and significant companies.
Some of the measures mentioned by Ms Truss were previously announced by the Foreign Office on Tuesday.
They include sanctioning Russian parliamentarians – which would require new legislation – and preventing British firms from doing business in the two rebel-held areas in Donetsk and Luhansk, recognised by Russia as independent.
Ms Truss also said the UK would restrict the Russian state and key companies from raising funding in UK financial markets, as well as ban a range of high-tech exports to Russia, “degrading the development of its military-industrial base for years”.
Announcing the UK’s “first barrage” of sanctions on Tuesday, Mr Johnson told MPs that Russian tanks had already been seen in the breakaway regions, and that it amounted to a “renewed invasion” – following Russia’s previous illegal takeover of Crimea from Ukraine in 2014.
Mr Johnson accused the Russian president of denying Ukraine’s statehood and “establishing the pretext for a full-scale offensive”.
A number of MPs, including Conservatives, have urged the prime minister to impose tougher sanctions on Mr Putin.
Shadow foreign secretary David Lammy told BBC Breakfast Russia should be cut out of the global financial system Swift, with greater efforts made to damage the Russian currency, including removing the country from the UK’s currency markets.
“If we’re serious we’ve got to go hard,” he said.
Lord Kim Darroch, a former UK ambassador to the US, told BBC Breakfast the UK’s sanctions appeared “pretty modest” compared to the EU’s and particularly Germany’s suspension of the Nord Stream 2 gas pipeline.
But he added: “All that said, I can understand why the government will want to hold some things back, because if there is the kind of escalation that I’ve talked about then we’ll need to hit Russia much, much harder with sanctions.”
Former Foreign Secretary Jeremy Hunt said the government needed to take action that Mr Putin is not expecting.
He told BBC Radio 4’s Today programme: “The most important is to do sanctions – economic and financial sanctions – that are tough enough and last long enough to reduce the ability of the Russian state to finance the Russian military.”
Tom Keatinge, director of RUSI’s Centre for Financial Crime and Security Studies, described the UK’s sanctions as “essentially taking a pea-shooter to a gun-fight”.
Perhaps the biggest penalty Russia has faced so far is the decision by German Chancellor Olaf Scholz to halt approval of the Nord Stream 2 gas pipeline under the Baltic Sea, a €10bn (£8.4bn) project which had been expected to allow Russia to sell more natural gas directly to Europe.
Meanwhile, the US and EU have both introduced a range of sanctions, including restricting the Russian state from financing its debt from their banks and banning their own companies from trading with the two rebel-held regions.
They have also targeted key Russian individuals and organisations with sanctions.
Who and what are being targeted by UK sanctions?
Putin ally Gennady Timchenko is a billionaire hockey enthusiast with wide business interests in energy, transportation and construction via his Volga investment group.
The UK government has accused him of supporting a Russian policy of destabilising Ukraine through his association with Bank Rossiya, of which he is a major shareholder.
Igor Rotenberg, another close associate of President Putin, is the oldest son of Arkady Rotenberg and the majority shareholder in the Gazprom Drilling company.
Igor’s uncle, Boris Rotenberg, has also been targeted. Mr Rotenberg is the co-owner – along with his brother Arkady – of the SGM group, the largest construction company for gas pipelines and electrical power supply lines in Russia.
The UK’s sanctions notice says he is “benefiting from or supporting” the Russian state in his role in a key strategic sector.
Rossiya is a privately-owned bank, which also has stakes in a television company.
The Black Sea Bank is a Crimean bank and was created in 2014 after Russia annexed the region.
The General Bank is a financial institution which also operates in Crimea.
Promsvyazbank is a Russian state-owned bank, which the UK government says provides funding to Russia’s military.
The BBC’s business correspondent Theo Leggett says the UK was not targeting the biggest banks but banks known to be used by President Putin’s inner circle.
