WASHINGTON, D.C.: The United States (US) delivered a stern warning to Russia on Thursday (Friday in Manila) at the World Bank/IMF meetings in Washington amid worries that a spiralling Ukraine crisis could hurt the world economy.
Treasury Secretary Jacob Lew told his Russian counterpart Finance Minister Anton Siluanov that in addition to the actions following last month’s annexation of Crimea, “the United States is prepared to impose additional significant sanctions on Russia if it continues to escalate the situation in Ukraine,” the Treasury said.
US President Barack Obama echoed the threat hours later in a phone call with German Chancellor Angela Merkel, as tensions in Eastern Europe threatened to overshadow the World Bank/IMF meetings on broader global economic challenges.
World Bank President Jim Yong Kim warned that the crisis would have far-reaching effects on Russia, forcing it into recession this year.
“This is a very serious issue for Russia—a very serious issue for its growth prospects,” Kim told reporters. “So we simply urge all of the parties to continue with negotiations and find a peaceful means of moving forward.”
G7 finance ministers and Central Bank governors later met briefly, with Ukraine, “its financing needs and the international response,” again high on the agenda.
Growth ‘too weak’
The spring meetings of the two global finance institutions started with IMF Managing Director Christine Lagarde calling for bold action to prevent risks in advanced and emerging economies from undermining a “subdued” global rebound from the economic crisis.
Lagarde said the Ukraine question, slower growth in emerging economies, the threat of deflation in the eurozone, financial sector vulnerabilities in the two leading economies and market turbulence generally are serious hurdles to extending the global recovery.