An assessment of the EU’s restrictive measure against the Russian Federation

Abstract

This dissertation evaluates the EU’s imposition of restrictive measures against the Russian Federation following the annexation of Crimea in 2014 and the subsequent invasion of the eastern regions of Ukraine in 2022, focusing on the factors influencing their effectiveness over time. Analysing data, the study underscores the substantial impact of Russia's actions on EU-Russia trade relations and related economic dynamics. The decline in trade volumes, coupled with fluctuations in GDP growth and foreign direct investments, highlights the vulnerability of both economies to political tensions. Russia's strategic responses, including diversifying trade partners and increasing military spending amidst economic pressure, reflect efforts to navigate external challenges. Managing these tensions while pursuing diplomatic resolution and economic stability will be critical for the EU and Russia. The findings indicate a significant decline in EU-Russia trade volumes following Russia's annexation of Crimea and invasion of Ukraine, with imports and exports experiencing notable decreases. The disruptions extend to various sectors, including food markets, exacerbating concerns about food security and necessitating efforts to seek alternative sources. While Russia has sought to expand trade partnerships beyond the EU, the imposition of EU sanctions has had a tangible impact on Russia's GDP growth rate and foreign direct investments, weakening its economic position. Member states such as Germany, Hungary, and Finland have experienced varying economic challenges due to their dependencies on Russian energy and supply chains. Despite initial expectations of severe economic downturns, Russia has demonstrated resilience, partially due to effective countermeasures and trade diversification. However, the EU's reliance on Russian imports has hindered the full effectiveness of sanctions. Nevertheless, sanctions have achieved key objectives, including ‘signalling Western unity, weakening Russia's military capabilities, and exerting pressure on its economy and energy sector’. A notable consequence has been Russia's increasing reliance on China, posing risks of economic disruptions. Experts suggest adopting a more nuanced approach to sanctions, considering Russia's economic resilience, geopolitical goals, and member states' economic interests. Ultimately, while the effectiveness of sanctions in ending the war in Ukraine remains uncertain, they serve as symbolic instruments of foreign policy, signalling unified defence against Russian aggression and defiance of international norms.