(Bloomberg) — Germany’s finance chief proposed a “Marshall Plan” to help Ukraine rebuild when the war ends, after U.S. President Joe Biden said Russia’s use of a hypersonic missile was a sign President Vladimir Putin is growing desperate.
President Volodymyr Zelenskiy said Ukrainian forces were still holding Russian troops at bay on many fronts and indicated that the nation would hold a referendum on the terms of any potential peace agreement. The invasion has driven 10 million people — nearly a quarter of Ukraine’s population — from their homes, according to the United Nations. About 3.4 million have fled to other countries such as Poland.
Ahead of this week’s European Union summit, Germany and Hungary are putting the brakes on a potential embargo on Russian oil, deepening differences in the bloc over how to further punish Moscow. The Kremlin warned that such measures would “hit everyone,” especially Europeans.
(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)
Key Developments
- Biden Sees Risk of Russian Cyberattack on U.S. as Sanctions Bite
- Stalled Elsewhere, Russia Focuses on Mariupol in Ukraine Plan B
- EU Leaders Poised to Support Taxing Windfall Energy Profits
- Oil Thirst Is Forcing Biden to Pivot U.S. Back to Saudi Arabia
- YouTube at Risk of Russia Ban After Facebook Is Deemed Illegal
All times CET:
Oil Reverses Earlier Gain (11:00 a.m.)
Oil reversed an earlier gain in choppy trading as the EU weighs a possible ban on Russian crude imports, though some key members remain opposed to such a move for now.
Brent futures fell below $114 a barrel after earlier topping $119. EU foreign policy chief Josep Borrell said he expects leaders to discuss — but probably not yet approve — further sanctions against Russia when they meet in Brussels later this week. Stocks in Europe advanced along with U.S. equity-index futures.
Ukraine Will Need ‘Marshall Plan,’ Germany Says (10:40 a.m.)
Ukraine will need an international “Marshall Plan” similar to the one created by the U.S. after World War II to finance reconstruction once Russia’s invasion ends, according to German Finance Minister Christian Lindner.
“Our solidarity toward our European neighbors is for the long term and so we need an international Marshall plan for Ukraine,” Lindner said in a speech to the lower house of parliament in Berlin. “We hope for peace soon but when it’s achieved we will also be there to offer support for the reconstruction,” he added.
Named after U.S. Secretary of State George Marshall, the post-war recovery plan covered 16 nations including Germany, according to the Marshall Foundation. They received almost $13 billion in aid through 1951 which paid for food, fuel and machinery and investment in rebuilding industry.
Serbia Denounces Threat for Not Joining Sanctions (10:30 a.m.)
Serbia angrily disputed a suggestion from EU member Lithuania that the Balkan state may be punished for refusing to join sanctions against Russia even as Belgrade seeks to join the bloc.
“Threatening Serbia with sanctions unless it imposes sanctions against the Russian Federation is as stupid as it is hypocritical,” Interior Minister Aleksandar Vulin said in comments published on the government’s website. He was reacting to a call on Monday by Lithuanian Foreign Minister Gabrielius Landsbergis to penalize states that are still doing business with Russia and allowing Moscow to bypass EU sanctions.
Ukraine Criticizes Neighbor Hungary on Sanctions (10:00 a.m.)
Ukraine criticized Hungary after its foreign minister, Peter Szijjarto, said EU sanctions on Russian energy imports were a “red line” and Budapest wouldn’t support a no-fly zone in Ukrainian airspace. While Hungary is a member of NATO and the EU, Szijjarto and his prime minister, Viktor Orban, have nurtured close ties with Russia.
“One can’t guarantee peace and security in Hungary without peace and security in Ukraine,” Ukrainian Foreign Ministry spokesman Oleh Nikolenko wrote on Facebook. “It’s useless to hope that efforts to please an aggressor will yield success. It’s proven by history, including Hungary’s history.”
EU Discussing Further Sanctions: France’s Beaune (9:45 a.m.)
Clement Beaune, France’s secretary of state for European affairs, said discussions are ongoing in the EU on reinforcing sanctions against Russia.
“We will regularly increase pressure on Russia. If we need to impose new packages of sanctions, we will do so, discussions are under way,” Beaune told reporters before a ministerial meeting in Brussels. Some EU states have called for more sanctions on top of those already agreed targeting the Russian economy, though there is resistance from countries like Germany and Hungary to the idea of a Russian oil embargo.
Beaune said the EU can still reinforce existing packages “with a message always clear and simple, unfortunately necessary to Russia: if the operations, if the war chosen by Russia, continues, we will increase the price to pay and the pressure we exercise on Russia.”
Russia Makes $66 Million Bond Coupon Payment (9:20 a.m.)
Foreign holders of Russia’s sovereign bond maturing in 2029 are watching their accounts for their latest debt coupon after the government said a $66 million payment had been made to its local depository.
The Finance Ministry announced that the transfer to the National Settlement Depository meant it had met its obligations on the bond coupon “in full.” The debt also has a ruble-fallback option, which allows Russia to make the payment in its local currency, provided it meets certain requirements.
China Envoy Urges Firms To “Fill the Void” (8:45 a.m.)
China’s top Russia envoy, Ambassador Zhang Hanhui, on Sunday told Chinese executives in Moscow to seize economic opportunities created by the crisis, a strategy that could help soften the blow of sanctions on Russia. The comments were summarized by the Russia Confucius Culture Promotion Association on its official WeChat account.
Biden warned Chinese counterpart Xi Jinping on Friday of unspecified “implications and consequences” if Beijing supported Putin over Ukraine. While China has decried sanctions and pledged to maintain “normal trade relations” with Russia, major Chinese companies so far appear to be complying with the penalties.
Putin Foe Navalny Convicted of New Fraud Charge (8:30 a.m)
A Russian court convicted jailed opposition leader Alexey Navalny on new fraud charges, Interfax reported, a ruling that may keep Putin’s main critic in a maximum security prison for 13 years.
The conviction comes amid a harsh crackdown on dissent since the start of the war a month ago, with Putin labeling those opposed to the invasion as “traitors.” Navalny has used his appearances during the trial to denounce the war. This week Russia banned Facebook and Instagram as “extremist” and the authorities have blocked or shut down independent media in order to control access to information.
Ukraine Forces Holding Russia at Bay: Zelenskiy (8:30 a.m.)
Zelenskiy repeated his assertion that Russian troops were still largely being held back, requiring them to focus on reinforcing existing positions rather than taking new ones.
In a late night video address, Zelenskiy said Russia had shelled locations in the Zhytomyr region of northern Ukraine. He accused troops of firing at convoys of civilians evacuating near Zaporizhzhia, a city in the south which has a nuclear power plant now controlled by Russia. Humanitarian corridors designed to allow safe passage of people from conflict areas have struggled to hold in the south, including for the besieged port city of Mariupol.
Russia Halts WWII Peace Talks With Japan (1:57 a.m.)
Russia will stop negotiations with Japan on a peace treaty that would officially end a conflict dating back to World War II after Tokyo imposed unprecedented sanctions over the invasion.
The two countries never sealed an official treaty ending the war as they wrangled for decades over a small group of islands close to Hokkaido. The Soviet Union seized the isles in 1945, expelling thousands of Japanese residents.
Biden Says Hypersonic Missile Shows Putin Desperate (12:10 a.m.)
Biden said the Ukrainians are “wreaking havoc against the Russian military, whether it’s their tanks, or their helicopters or their aircraft,” adding: “And if you notice, they’ve just launched their hypersonic missile because it’s the only thing they can get through with absolute certainty.”
U.S. Defense Secretary Lloyd Austin declined to confirm that Russia had used a hypersonic weapon in a CBS News interview a day earlier. The missile, designed to travel several times the speed of sound, is “almost impossible to stop,” Biden said in remarks to the Business Roundtable, a Washington lobby group.
The president also stressed the danger of cyberattacks, saying of Putin: “He has the capability. He hasn’t used it yet but it’s part of his playbook.”
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