Macron to Speak With Putin on Friday Over Crisis: Ukraine Update

(Bloomberg) — A Kremlin spokesman warned that a U.S. move to put as many as 8,500 troops on alert “exacerbates tensions,” as top Biden administration officials said reinforcements for NATO forces in Eastern Europe and potential sanctions on Russia are ready to go. 

Evidence also emerged that European governments are split on what Russian actions short of a military attack on Ukraine should trigger sanctions. French President Emmanuel Macron’s Russia adviser is in Moscow to present proposals for deescalation — and German Chancellor Olaf Scholz will host Macron in Berlin on Tuesday evening.

Russia has massed thousands of troops, tanks and equipment near Ukraine’s eastern border and the U.S. and its allies say it could be preparing for military action. Moscow has denied it intends to invade.

Key Developments:

  • U.S. Treasury’s Adeyemo says Russia sanctions are ready
  • EU split on response to Russian acts short of invasion
  • Ukraine minister downplays risk of full-scale incursion
  • U.S. says 8,500 troops are on alert for deployment
  • Ukraine tension poses a risk for the price of bread

All times CET.

Macron Plans Friday Call With Putin (7:43 p.m.)

French President Macron said he will speak to Putin on Friday morning to seek clarifications on the situation with Ukraine.

Russia will pay a high price if it attacks Ukraine, Macron and German Chancellor Olaf Scholz said in a joint news conference in Berlin, calling on Moscow to de-escalate. The pair said they continue to pursue a range of diplomatic solutions, but Macron said they are “preparing forms of reactions” should Moscow take aggressive steps.

Scholz defended Germany’s refusal to send military equipment to Ukraine, saying that Germany doesn’t send weapons abroad for historic reasons, a reference to the country’s role in World War II.

Adeyemo Says Sanctions on Russia are ‘Ready’ (7:39 p.m.)

Deputy Treasury Secretary Wally Adeyemo said the U.S. and its European allies have economic sanctions “at the ready” in case Russian troops invade Ukraine.

“We have a carefully designed set of sanctions that would have a significant impact on the Russian economy and mitigate the impact it would have here in the United States,” Adeyemo said Tuesday in an interview with Bloomberg Television.

Asked whether he’d support expelling Russia from the Swift system of international payments, Adeyemo said “All options are on the table.”  

Johnson Says Discussing Removing Russia from Swift (3 p.m.)

The U.K. is in talks with the U.S. about dropping Russia from the Swift international payments system if it invades Ukraine, Prime Minister Boris Johnson said in parliament.

Johnson said the U.K. has a “hard-hitting package of sanctions ready to go” that would be directed against individuals, including Magnitsky sanctions, as well as against companies.

Ukraine Resistance Would be Tenacious: Johnson (2:35 p.m.)

Johnson also told lawmakers if the “worst happens” in Ukraine the country’s resistance “would be dogged and tenacious, and the bloodshed comparable to the first war in Chechnya or Bosnia or any other conflict that Europe has endured since 1945.”

Foreign Secretary Liz Truss said it’s “unlikely” that U.K. combat troops will be sent to Ukraine, and announced that she will visit the country next week.

Borrell Wants Ukraine Training Mission Unblocked (2:30 p.m.)

The EU’s foreign policy chief, Josep Borrell, has asked Germany and several other member states blocking a mission to Ukraine to train local military and security staff to reconsider their positions, diplomats familiar with the matter said.

Germany, Greece and several other countries have been preventing the EU mission from taking place due to concern it might provoke Russia, the diplomats said.

U.S. Troops ‘Ready to Go’ to Bolster NATO (2:20 p.m.)

The U.S. troops on heightened alert for deployment to bolster NATO forces in Eastern Europe are “ready to go at a moment’s notice,” White House Deputy National Security Advisor Jon Finer said in an interview with CNN.

“The important thing to point out is this is not an aggressive step by NATO,” Finer said. “This is a defensive stance that they would be taking and a reassurance step in response to what Russia has done.”

U.S. Mulling Curbs on Chip Exports to Russia: CNBC (1:48 p.m.)

The U.S. administration has been evaluating possible restrictions on exporting semiconductor chips to Russia, CNBC reported, without naming the source of its information.

Sanctions ‘Counterproductive’: French Far-Right Leader (12:30 p.m.)

French far-right leader Marine Le Pen, a frontrunner in April’s presidential election, said sanctions on Russia are counterproductive and warned against “a new Cold War” led by the U.S.

Such a conflict could “push Russia into the arms of China” and “lead to the creation of a Sino-Russian empire,” Le Pen said in an interview with Bloomberg Television. “We were completely sidelined from the discussions between the U.S. and Russia,” she added. “This shows how much influence we have lost.”

Kremlin Says U.S. Troops on Alert Raises Tensions (10:20 a.m.)

The U.S. troop move “exacerbates tensions” and Russia is monitoring the situation “with great concern,” according to Kremlin spokesman Dmitry Peskov.

Russia still expects to receive written U.S. responses to its security demands this week, after which it will decide on prospects for future diplomacy, Peskov said on a conference call with reporters. Among other things, Russia is demanding that NATO pull back military infrastructure from its periphery, something the alliance has so far refused to do.

U.S. Coordinating With Allies on Reply to Russia (10:20 a.m.)

The U.S. is coordinating with the EU and NATO on its written response to Russia’s demands about NATO and Ukraine, according to an EU official who asked not to be identified.

The reply is unlikely to be a detailed discussion of those requirements, the official said, but will set out areas where western allies believe they can address Russian concerns, as well as Russian actions that are alarming to Europe.

British Minister Flags Russian ‘Advance Force’ (10:15 a.m.)

The U.K.’s armed-forces minister has claimed in an opinion piece, without providing further details, that Britain is aware of “a significant number of individuals that are assessed to be associated with Russian military advance-force operations and currently located in Ukraine.”

Moscow hit back on Sunday at separate U.K. allegations that it’s plotting to install a pro-Russian leader in Kyiv. Those assertions, offered without a timeline on the intelligence, were contained in a U.K. Foreign Office statement.

Ukraine Minister Plays Down Risk of Ground War (10:10 a.m.)

Ukrainian Defense Minister Oleksiy Reznikov played down the prospect of a full-scale invasion by the Russian military and reinforced the view from officials in Kyiv that the nation’s security challenge hasn’t changed significantly since 2014.

“The aggression continues since 2014 — the facts are the same, but the assessment of these facts is different,” Reznikov told reporters on Tuesday, citing international media coverage. Still, the shift is giving Ukraine the chance to benefit from greater military assistance, he said.

Germany Defends Restrictive Arms Export Policy (9:30 a.m.)

Tobias Lindner, a deputy German foreign minister, defended the government’s policy of not supplying Ukraine with weapons, arguing that there could never be a military solution to the conflict.

“You won’t be able to upgrade Ukraine’s army quickly enough so that one could solve this crisis by achieving a military equilibrium,” Lindner said Tuesday during a video call with foreign-policy analysts. Germany’s strategy to deter Russian President Vladimir Putin from an invasion relies on the threat of economic sanctions, Lindner added.

United Nations Calls for Winter Olympics Truce (9:20 a.m.)

United Nations Secretary General Antonio Guterres urged nations to respect the “Olympic Truce,” calling on all countries to halt hostilities during the Winter Games in Beijing.

“With conflict spreading and tensions rising, this appeal represents a chance to overcome differences and find paths towards lasting peace,” Guterres said in an emailed statement. The Winter Games take place Feb. 4-20 and the Paralympic Winter Games March 4-13.

Latvia Says Russia Rejected Inspection Request (8:30 a.m.)

Russia last week rejected a request from Latvia to inspect military drills, citing restrictions imposed due to the pandemic, according to the defense ministry in Riga.

“This refusal is not understandable in a situation where Russia is massively concentrating its troops on the Ukrainian border, while at the same time claiming that it has no plans to invade,” Latvian Defense Minister Artis Pabriks said. “The excuse of Covid-19 restrictions suggests that Russia has something to hide and that it does not want to reveal the true size and intentions of its military activities, as foreseen under OSCE cooperation,” he added.

Ukraine Ambassador Repeats Call for German Support (8:30 a.m.)

Ukraine’s ambassador to Berlin repeated a call for Chancellor Scholz’s government to supply it with “defensive weapons,” making a direct appeal to Germans on a morning television show.

“We have the right to self-defense so we hope that the Germans will wake up and realize that we’re facing the biggest threat since World War II,” Ambassador Andriy Melnyk said on ZDF TV. “We have to show Russia that Ukraine is ready and armed.”

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