Lew Says Sanctions Helping Pressure Russia as Economy Weakens

U.S. Treasury Secretary Jacob J. Lew said U.S. sanctions have isolated Russia’s economy and the Obama administration could take additional measures against President Vladimir Putin’s government.

“Our coordinated and carefully calibrated approach has put enormous pressure on Russia, with limited collateral damage to the U.S., European, and global economy,” Lew said in a speech in Washington today. President Barack Obama has “given us the authority to take even more powerful action if Russia continues to support armed separatists in eastern Ukraine,” he said.

The International Monetary Fund has estimated that $100 billion in investment may exit Russia this year, and Lew said its economy “has already started to contract.”

After winning a presidential election on May 25, billionaire chocolate magnate Petro Poroshenko said he’d retool a struggling anti-militant operation to seal a rapid victory over separatists emboldened by Putin’s annexation of Crimea.

“Last week’s election was a promising sign for the future of Ukraine, but there is evidence that Russia continues to allow the free flow of weapons, funds, and fighters across its borders and President Putin’s next steps are still not clear,” Lew said in prepared remarks.

The Obama administration has sanctioned 45 people and 19 entities, including banks, in response to Russia’s involvement in Ukraine.

Lew was speaking at the Center for Strategic and international Studies for a conference marking the 10th anniversary of the creation of the Treasury’s Office of Terrorism and Financial Intelligence.

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