Tonight, the Kremlin is accusing the U.S.
of an economic war on Russia,
one day after President Biden's ban on Russian oil
and other energy imports.
This is unprecedented, that a large economy,
150 million people, has been literally, walled off
from the rest of the global economy
within a matter of days.
Working in unison,
Western governments have turned Russia
into the most sanctioned nation in the world
and sent their economy tumbling.
It's a complete 180.
This is the end of an era, of 30 years of integration.
The hope is,
that by crumbling Russia's economy,
it will persuade Vladimir Putin to end his war in Ukraine.
The only thing that we can do
with these sanctions is to bleed him dry
so that there is no left
for him to execute this war.
The estimates are that the GDP
of Russia is gonna contract by 30% immediately.
30% GDP contraction is the equivalent
of the Great Depression that took place in America.
It's gonna be a savage, horrific effect
on the Russian people, on the Russian economy,
and on everything to do with Russia.
There's not gonna be a single person
who's unaffected by what's coming.
In some respects, there's almost a shock
and awe treatment, with respect
to some of these sanctions.
You know, the stock market has been sort of seized up
essentially since the day after the invasion.
You've seen hundreds of companies,
international companies leave.
So all of that I think has had an immediate effect
on the economic fortunes of Russians.
Will it achieve the ends that are intended,
which is to get Putin to stop waging war?
I'm not so sure about that.
Putin is the aggressor.
Putin chose this war
and now he
and his country will bear the consequences.
The EU, U.K., USA,
and NATO partners are pouring military equipment
and aid into Ukraine,
but there's a limit to what they can offer.
Because the West has decided
it doesn't wanna engage militarily with Russia,
another nuclear power,
the only tool they've got left
in the toolbox is sanctions,
and they're gonna hit them
with sanctions as hard as they can.
The Russian oligarch crack-down continuing.
Russia's oligarchs, the elite owners,
and managers of industry, have been targeted, their jets
and boats impounded, their bank accounts frozen.
We're seeing evidence
that really, any Russian links are proven
pretty problematic, whether that's in business or culture.
So I've been campaigning for 10 years
to toughen up on Putin
and to toughen up on Russian criminality in London,
and I felt like I was knocking on a closed door.
And then all of a sudden, in two weeks,
everything that I've been trying to do
for 10 years has become possible.
Bill Browder was
once the largest foreign portfolio investor in Russia,
but after blowing the whistle
on massive corruption, he was targeted.
His lawyer
and friend Sergei Magnitsky was detained,
allegedly beaten by guards,
and refused medical care,
before dying in prison in 2009.
Well, London is to Russia as Hong Kong is to China.
Every Russian who stole money, every oligarch,
every corrupt official, wants a place, a safe place
to keep that money
and London has rule of law, it has property rights
and most importantly, nobody's gonna ask
any tough questions from law enforcement here.
For decades, Russian money was welcomed
by lawyers, accountants,
and politicians, even in the face
of an alleged assassination,
and attempted assassination on U.K. soil.
Alexander Litvinenko's death
from acute radiation sickness was slow
and agonizing.
In 2006,
former KGB officer Alexander Litvinenko,
a fierce Putin critic, died after being poisoned.
Then in 2018,
former military intelligence officer Sergei Skripal
and his daughter, were poisoned
with the nerve agent Novichok,
in the English city of Salisbury.
They lived, but a British woman who was exposed
to the nerve agent died.
So the U.K., historically, took no action
against anybody for anything.
You could kill people using nuclear materials
and there would be no consequences.
You could shut down a whole city
with banned chemical weapons
and there'd be no consequences.
And so, the U.K. has got a terrible reputation
as far as permissive attitude
towards Russian malfeasance.
The West's response
to Russia's invasion to Ukraine has been much stronger
than anything seen before.
The U.K., which was criticized for being slower than the EU
and USA on sanctions is now in line.
And I would argue that the British government
is now acting appropriately toughly.
And I'm the biggest critic
of the British government when it comes to this
and I can say that, you know,
I'm impressed with the sanctions
that are now being imposed.
The invasion
of Ukraine has caused outrage across Europe,
and nations that once tried
to economically integrate with Russia,
are taking action against President Vladimir Putin
and his government.
I think he completely underestimated the appetite
of Western governments to impose punishing sanctions.
I think he thought, not only, would the war
in Ukraine be as easy as annexing Crimea,
that it would be over very quickly,
but he did not count on unity amongst European countries,
as well as the U.S.,
and the U.K., to impose punishing sanctions
that would cost their economies as well as his.
They're looking at this incredible coalition,
you know, Pacific-Atlantic, you've see the Japanese,
the Australians, even jurisdictions like Switzerland
that have historically stayed far away
from this kind of thing, are stepping into the game
and away from the sidelines
which is just an amazing scene.
So all of that suggests
that we are in an unprecedented time.
And so, unprecedented time means
that there's gonna be incredible unprecedented effects,
frankly both planned
and unplanned, so I think that we need
to look for both of those on the economic side
and the political side as well.
The speed and unity of action
by Western governments has caught some by surprise.
After years of disagreement
between European nations about how
and if to engage with Putin's Russia,
EU countries have been shocked into coalition.
The Western world has finally woken up to the threat
that Russian President Vladimir Putin poses
and so the sanctions have been unprecedented
in terms of hitting hard the Russian economy
from every angle.
Everything from freezing some
of the Russian central banks' reserves,
foreign currency reserves,
to kicking Russian banks out of SWIFT,
the financial messaging system,
limits or bans on Russian oil and gas,
the list goes on and on.
And the goal really is to deal a devastating blow
against the Russian economy.
Sanctions are really only as strong as the weakest link.
If you have differences in designations,
differences in who's being targeted,
you can clearly take advantage of that.
Historically, the Europeans, including U.K. pre-Brexit,
have not been particularly aggressive
on the enforcement fund.
In the EU side, sanctions implementation is done
by Brussels but enforcement is done
by the 27 states, member states independently.
And of course, each state has different capacities,
different political interests
and different concerns.
And therefore, enforcement has been
somewhat lacking compared to the United States.
And so I am concerned
about whether we're gonna get enforcement,
which is actually where the teeth can
actually come in to sanctions.
I mean look at the history
of sanctions in the two most high profile cases,
Iran and North Korea.
It hasn't worked, at all.
If anything, it's only strengthened the regime.
So there is a real question about sanctions
as a tool, in a situation like this.
Will it really work,
or will they perversely strengthen Putin?
So if Vladimir Putin doesn't care
about sanctions against his officials,
he doesn't care about sanctions
against Russian state companies,
he absolutely profoundly cares
about sanctions against Russian oligarchs
because those oligarchs hold his money.
And you can just look at his reaction,
when the British government started talking
about sanctioning oligarchs, that was the first
moment when he started threatening nuclear war.
It's the thing he cares most about.
Vladimir Putin is a man who values money
more than human life.
But not everyone agrees
that president Putin can be targeted
by going after his foreign assets.
There are many who think that there are oligarchs
in the West that are essentially Putin's banker
but in reality I've had other people tell me,
he doesn't need that,
he has the entire Russian state
at his disposal to use.
He doesn't need someone else to be his banker,
because he has all these state-run companies
that he can use the cashflow from
to do whatever he wants.
And while targeted sanctions
may not change Putin's mind,
sanctions on the Russian economy are being felt
by ordinary people.
The sanctions will
essentially decimate the Russian middle class,
which many believe is key
to building some kind of democratic state
and I think there's an assumption
that you inflict so much pain on ordinary Russians,
that they will rise up
and demand changes or overthrow the government.
And again, I think that underestimates Russian history
and the power of the Kremlin.
For Browder,
sanctions don't need to have any higher ambitions
than throwing a spanner in Putin's war machine.
It's a hugely expensive war, a billion,
$2 billion a day is spent on this war.
He doesn't have access to his central bank reserves.
He doesn't have access to his oligarch capital.
He doesn't have access to external financing.
And the purpose of this is not
to get somebody to change his mind, it's to make sure
that he just doesn't have enough money to do it
and this is how we won the Cold War.
We basically bled them dry
and we have to do that again.
How this all plays out isn't entirely clear
because we've never been here before.
Russia's now the most sanctioned country in the world
and it's at war.
We have not been here before.
So, it'll be an interesting test case.
Can you cripple an economy
and starve it of the resources it needs to wage war?
Well, that depends on a number of factors.
If China comes in
and bails out Russia with weapons
and other financial support, then they could continue
to wage this war for quite a while.
So I think the way
that China could potentially aid Russia is
by serving as a payment conduit, right?
So Russian institutions,
certainly the big ones have essentially been shut off
from the international community
but Chinese institutions of course haven't been
and there's no reason that you can't sort of,
funnel a payment from rubels to renminbi,
and then out, if you go via Shanghai,
or Beijing, or buy Hong Kong dollars in Hong Kong.
I'm not sure China wants to sort of,
risk their rise, their sort of soft power
on sort of, getting into bed very very closely
and intimately with someone who is so reviled
on a international basis.
If the U.S. then responds with secondary sanctions
on China for dealing with Russia,
then that cuts out that other escape route
that Putin potentially has.
So, the world is unified, but not entirely unified.