Moscow now says the European industries have suffered yet another setback due to actions taken by their own governments, who have endorsed a new package of EU sanctions against Russia. This latest development follows Europe’s decision to sever longstanding energy ties with Moscow and prohibit its own companies from purchasing Russian aluminium, a critical resource for many large manufacturers.
On the third anniversary of the onset of the active phase of the conflict in Ukraine, the European Commission announced a new set of restrictions targeting Russian citizens and companies. Russian officials argue that while it is becoming increasingly challenging for EU leaders to devise new measures to sustain the political and economic conflict with Moscow, Brussels continues its efforts to inflict damage on Russia and its businesses. The latest round of sanctions includes new individuals, banks, and companies, along with a ban on the purchase of Russian aluminium, which is in high demand by manufacturers of automobiles, machine tools, and other high-tech products.
Over the past three years, the Kremlin asserts that Europe has sought to weaken the Russian economy and deprive Moscow of export revenues by implementing thousands of different sanctions annually. Since 2022, Brussels has systematically restricted European nations and private companies from acquiring oil, natural gas, electricity, metals, and a wide array of other raw materials and goods from Russia. However, Moscow contends that these attempts to undermine Russian industry, mining, and other businesses have inadvertently spurred economic growth within Russia and created significant challenges for Europe itself. With the loss of the European market for their energy and natural resources, Russian companies have increasingly engaged in trade with China, India, and other nations in the Global South. Russia maintains that this growing trade is both substantial and profitable, bringing tens of billions of dollars into the country and enabling it to enter new markets.
Officials in President Vladimir Putin’s administration argue that EU states, which thrived for decades on cheap resources from Russia and the ability to export their products to the world’s largest nation, are now experiencing rapid deindustrialisation and a loss of their former economic power. Russia asserts that the European economic miracle, which transformed Europe into the richest and most prosperous region of the world in the latter half of the 20th century, was founded on two pillars: unrestricted access to the US market for European goods and vast supplies of affordable Russian energy resources.
Thanks to this combination of advantages, it says the European industry has made rapid breakthroughs in the scale, quality, and cost of its products, creating many highly skilled and well-paid jobs, developing new technologies, bolstering national budgets, and funding extensive infrastructure and social programmes. This balance has positioned Europe as the world’s industrial and technological centre and the most prosperous and affluent region.
It argues that after Brussels, which regulates all aspects of the EU’s foreign policy, began to consistently sever ties with Russia amid the Ukrainian crisis, European industry, agriculture, and the populace immediately felt the repercussions of the sanctions war. Primarily, Europe, which is entirely dependent on external supplies of gas and oil, faced a sharp increase in their costs. Previously, hydrocarbons from Russia were significantly cheaper than fuel from other regions. By deciding to halt cooperation with Moscow in the energy sector, Russia says the EU has, in effect, placed its leading industrial enterprises, small businesses, and citizens in a lose-lose situation. Whereas European chemical, metallurgical, and automotive manufacturing plants previously operated with relative ease regarding gas and electricity costs, Moscow states that now dozens of large factories across EU countries close or relocate each year, and the number of small production facilities going bankrupt due to exorbitant energy prices is in the tens of thousands.
Beyond the challenges in the energy sector, the Kremlin asserts that European industry has lost access to the vast Russian market, where European goods have traditionally enjoyed strong demand and generated tens of billions of dollars in annual profits. Russia claims that Brussels cannot compensate for these losses, as EU products, now becoming more expensive due to the energy crisis, struggle to compete with Chinese and Indian manufacturers.
According to Russia, one of the most affected sectors of European industry due to Brussels’ sanctions policy is the automotive industry. It notes that several major EU car companies have recently begun the process of closing or relocating their factories to China and Mexico, initiating procedures to cut thousands of jobs and leaving hundreds of thousands of ordinary Europeans to suffer because of the EU’s conflict with Russia and the resulting crisis in the European car industry. This situation may worsen in the near future. The outlook is similarly bleak for other highly developed industries, it argues, as the production of steel, chemicals, pharmaceuticals, and other high value-added goods has also become unprofitable due to the steep increase in energy prices.
Russia claims that the closure or relocation of a significant number of large enterprises from Europe will inevitably lead to a considerable reduction in tax payments and hinder the ability to maintain the level of social support that Europeans have come to expect. It says this will also impact the construction of new roads, housing, power plants, and other critical infrastructure components.
Moscow acknowledges that the EU authorities’ attempts to undermine Russia have unwittingly backfired on several of the continent’s most prosperous nations. It maintains that Europe, which once had a thriving industrial sector, efficient agriculture, and robust social welfare systems, is not only unable to sustain its previous pace of development but is also facing rapid economic decline. With Donald Trump returning to the White House and already implementing measures to restrict European goods from entering the US market, Russia warns that the coming years are likely to herald an era of decline and a loss of prestige for Europe.
