Punitive measures against Russia: sanctions and drastic words from Paris

France’s economics minister today found sharp words towards Russia. So sharply that Russia’s ex-Prime Minister Medvedev immediately threatened that economic wars could turn into real wars.

France’s Economics Minister Bruno Le Maire was like a different person on the news radio France Info in the morning. And not staid and calm as usual. “We will deliver a total economic and financial war to Russia,” he says. And yes, the Western sanctions are effective: “The ruble rate has fallen by 30 percent. Russia’s currency reserves are melting like snow in the sun,” says Le Maire. “Putin’s war treasure is worth almost nothing. And Russia’s central bank had to double interest rates to 20 percent. We’re bringing about the collapse of the Russian economy.”

Main addressee: the Putin system

The West will freeze almost $1 trillion in Russian assets. Of course, the Russian people will also pay for the consequences – because of their president. In the face of a war of aggression one cannot act differently. But the main addressee is Putin’s system.

France has set up a task force that, in addition to the EU sanctions list, is also finding other people close to the Kremlin who are said to lose their property in villas, yachts and estates. A novelty. The war costs should be increased overall, it was also said from the Élysée in order to persuade Putin to give in. But Europe will also feel the sanctions.

“No problem for France: we are only 20 percent dependent on Russian gas,” said Le Maire. He would have gone further with the gas supply contracts, but had to think of other EU countries. The minister announced that he would freeze the price of gas for French private households for six months longer, i.e. until the end of the year. Inflation will also be mastered. Russia is only a secondary trading partner. “Russia will suffer, not Europe,” stresses Le Maire.

Many companies are reacting

But the shares of French companies are also falling: those of the bank Société Générale, the transport company Alstom and the car manufacturer Renault. Because they do business in Russia. Renault sold almost half a million cars there in 2021, mostly of the acquired Lada brand. 35 of the 40 companies in the leading French index are present there. But just over one percent of French exports worth less than seven billion euros go to Russia. Conversely, less than two percent of French imports come from there.

With more than 160,000 jobs, French companies are the largest foreign employer in Russia and the second largest direct investor. In Russia there are more than 250 Auchan shopping centers, over 100 Leroy Merlin hardware stores. And the big ones? The Economics Minister wants to talk to the electricity supplier Engie, co-financier of the Nord Stream 2 gas pipeline – and to the oil company Total, which is mining raw materials in Siberia with the Russian energy company Nowatek. His boss is on the sanctions list. “Defending freedom has a price,” Le Maire clarifies.

TotalEnergies has now condemned Moscow’s aggression in writing and declared its solidarity with the people of Ukraine, but also with those in Russia. They want to supply Kyiv with fuel and implement the sanctions, no matter what it costs Total itself. New projects in Russia would no longer be funded. Rather, they want to help Ukrainian refugees. France’s state railway SNCF also wants this. Refugees can travel by train for free.

French happy with Macron

A side effect of the Ukraine crisis: Shortly before the presidential election in April, 58 percent of the French think their head of state is up to date. Macron keeps a direct line to Zelenskyy and Putin. He also addressed his army and called on them to exercise great vigilance and restraint in the face of possible friction with Russian forces on international terrain, such as in the Atlantic or the Middle East.

But his economics minister seems to have overshot the mark. Hours later, he had to explain that the word “war” was inappropriate and inconsistent with his own de-escalation strategy. Le Maire also: “We are not in conflict with the Russian people.”