Russia ‘can’t make more’ tanks because of key sanction, Biden official says

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The West has hit Russia with a series of economic sanctions, including a promise this weekend from G-7 countries to reduce their dependence on the country’s oil. But one type of sanction, so-called “export controls”, has attracted less attention than other high-profile sanctions like the seizure of oligarchs’ yachts.

Export controls prohibit companies from sending crucial products like semiconductors to Russia in a bid to gradually starve its economy. But a senior Biden administration official told Yahoo Finance on Monday that some export controls could hurt Vladimir Putin’s army in the immediate future.

“Due to the export controls we have already put in place, the two major Russian tank manufacturers are no longer in business,” Deputy Treasury Secretary Wally Adeyemo said Monday. “Russia now has far fewer tanks than it had before this invasion, and it cannot do more because of the measures we are taking with the sanctions.”

The White House says the checks have left Russia’s two main tank factories – Uralvagonzavod Corporation and Chelyabinsk Tractor Plant – inactive due to a lack of foreign components. And observers noticed fewer tanks than normal during the annual military parade in Moscow’s Red Square on Monday.

A child stands on top of a destroyed Russian tank, amid the Russian invasion of Ukraine, near Makariv, Kyiv region. (REUTERS/Mikhail Palinchak)

Meanwhile, images of destroyed Russian tanks shot down by American-made Javelin missiles have become a rallying cry for Ukrainians and their allies.

“Make sure they have fewer resources to fight with”

On Sunday, the White House announced additional export controls on items such as wood products, industrial engines, bulldozers, etc., to “further limit Russia’s access to items and revenues that could support its military capabilities”.

The EU has acted alongside new controls on items like chemicals.

A senior administration official told reporters over the weekend that export control efforts began on specialty products like microchips and now “we’re expanding to industrial products that have a similar effect, according to us, on Putin’s ability to pursue his war ambitions”.

As Adeyemo told Yahoo Finance on Monday, the goal is to “reduce Russia’s resources to ensure that it has fewer resources to wage its war against Ukraine.”

Adewale, economist

Adewale “Wally” Adeyemo is the Under Secretary of the Treasury. (Greg Nash/Pool via REUTERS)

The Export Administration Regulations (EAR) as set forth in U.S. government documents not only apply to items produced in the United States, but also state that “foreign-made items located outside the United States are subject to EAR when they are a “direct product” of “industries such as technology, software, or manufacturing in the United States.”

The export controls are part of a series of new actions against Russia announced on Sunday, including sanctions against Russian individuals and companies and an attempt by G7 countries to stop importing Russian oil. . The U.S. Commerce Department also said Monday that the U.S. will temporarily suspend tariffs on Ukrainian steel for a year.

Ben Werschkul is a writer and producer for Yahoo Finance in Washington, DC.

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