G7 nations announce Russian gold ban as summit begins in shadow of war

  • Gold ban targets ‘Putin’s war machine’, says UK PM
  • Oil import price cap also under discussion, German source says
  • The G7 also aims to tackle soaring energy prices

SCHLOSS ELMAU, Germany, June 26 (Reuters) – Members of the rich Group of Seven countries announced a ban on Russian gold imports on Sunday as the G7 summit in the Bavarian Alps begins in the shadow of war in Ukraine and consequences ranging from energy shortages to a food crisis.

The move by Britain, the United States, Japan and Canada is part of efforts to tighten sanctions on Moscow and cut off its means of funding the invasion of Ukraine more than four months after the outbreak of a conflict, Russian President Vladimir Putin calls for a special military operation. .

“The measures we announced today will hit the Russian oligarchs directly and strike at the heart of Putin’s war machine,” British Prime Minister Boris Johnson said in a statement.

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“We need to starve the Putin regime of its funding. The UK and our allies are doing just that.”

A senior US administration official said the G7 would make an official announcement on the gold import ban on Tuesday. Read more

“This is a key export, an essential source of income for Russia in terms of its ability to transact with the global financial system,” the US official said.

Russian gold exports were worth 12.6 billion pounds ($15.45 billion) last year and wealthy Russians bought bullion to lessen the financial impact of Western sanctions, the British government has said.

In addition to the gold import ban, the G7 leaders were also having “really constructive” talks on a possible price cap on Russian oil imports, a German government source said. Read more

UNIT MESSAGE

The three-day summit takes place against an even bleaker backdrop than last year, when leaders from Britain, Canada, France, Germany, Italy, Japan and the United States met for the first time since the start of the COVID pandemic. -19.

Soaring global energy and food prices are hitting economic growth following the conflict in Ukraine, with the United Nations warning of an “unprecedented global hunger crisis”. Read more

Climate change, an increasingly assertive China and the rise of authoritarianism will also be on the agenda.

G7 leaders are expected to show a united front in supporting Ukraine for as long as necessary and increase pressure on the Kremlin, although they will want to avoid sanctions that could fuel inflation and exacerbate the cost of living crisis that affects their own people.

“The main message from the G7 will be unity and coordination of action,” an EU official said.

G7 leaders are also expected to discuss options for tackling rising energy prices and replacing Russian oil and gas imports.

The summit is also an opportunity for German Chancellor Olaf Scholz to demonstrate more assertive leadership in the Ukrainian crisis.

Scholz vowed a revolution in German foreign and defense policy after Russia invaded in February, promising to bolster the military and send arms to Ukraine. But critics have since accused him of dragging his feet and sending mixed messages.

GLOBAL PARTNERS

This year, Scholz has invited Senegal, Argentina, Indonesia, India and South Africa as partner countries at the summit.

“The summit must not only send the message that NATO and the G7 are more united than ever, but also that the world’s democracies are uniting against Putin’s imperialism, just as they are in the fight against hunger. and poverty,” Scholz told German. Parliament this week.

Many countries in the South are worried about the collateral damage of Western sanctions.

An EU official said the G7 countries would make it clear to partner countries that the food price spikes hitting them were the result of Russia’s actions and that there were no sanctions targeting the countries. foodstuffs. It was also a mistake to regard the Ukrainian war as a local affair.

“It’s more than that. It’s challenging the order, the post-World War II order,” the official said.

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Reporting by Sarah Marsh, Andrea Shalal, Philip Blenkinsop and William Schomberg Writing by Sarah Marsh and Matthias Williams Editing by Peter Graff and David Goodman

Our standards: The Thomson Reuters Trust Principles.

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