LONDON/MOSCOW (REUTERS) - Britain said on Monday (Jan 31) it would impose sanctions on companies and people with the closest links to the Kremlin if Russia takes action against Ukraine, drawing a warning from Moscow that it would respond if its businesses were "attacked".
Since the fall of the Soviet Union in 1991, London has become the pre-eminent global centre for a vast outflow of money from former Soviet republics.
Opponents of President Vladimir Putin, who has massed troops near Ukraine, have repeatedly called on the West to get tough.
Now Western economic sanctions might target Russia on Russian money, though oligarchs and Russian officials continue to flaunt their wealth at Europe's most luxurious destinations.
"We are very clear that if Russia takes further action against the Ukraine, then we will further tighten the sanctions regime targeting those businesses and people with the closest links to the Kremlin," Mr Simon Clarke, Chief Secretary to the Treasury, told Sky News.
Kremlin spokesman Dmitry Peskov said the threat of sanctions would amount to an attack on Russian businesses. He said such actions would backfire by hurting British companies and warned that Russia would respond.
Meanwhile, Russian Foreign Minister Sergei Lavrov will speak by phone with US Secretary of State Antony Blinken on Tuesday (Feb 1), the TASS news agency quoted a Russian foreign ministry spokeswoman as saying on Monday.
Washington and Brussels replied last week to Moscow’s demands for legally binding security guarantees amid a standoff over Ukraine’s aspirations to join Nato and other issues, but Russia has indicated it is not satisfied.
The United States, the European Union and Britain have warned Putin against attacking Ukraine.
Russia denies planning to attack Ukraine and is demanding security guarantees, including a promise by the North Atlantic Treaty Organisation (Nato) never to let Kiev join the alliance.
Russian officials say the West is gripped by Russophobia and has no right to lecture Moscow on how to act after Nato's eastward expansion since the Cold War ended.
The British government will introduce new legislation this week to broaden the scope of sanctions it can apply to Russia to try to deter aggression towards Ukraine, Foreign Secretary Liz Truss said on Sunday.
Britain has imposed sanctions on about 180 people and 48 entities since Russia annexed Crimea form Ukraine in 2014.
On the sanctions list are six people Britain says are close to Mr Putin: businessmen Yuri Kovalchuk, Arkady Rotenberg and Nikolai Shamalov, former KGB officer Sergei Chemezov, Russian Security Council Secretary Nikolai Patrushev and Federal Security Service chief Alexander Bortnikov.
The sanctions allow Britain to freeze individual assets and ban individual from entering the United Kingdom.
They also prohibit any individual from dealing with a post-2014 transferable security or money market instrument of a maturity over 30 days issued by Sberbank, VTB bank, Gazprombank, Vnesheconombank, Rosselkhozbank, OPK Oboronprom, United Aircraft Corporation, Uralvagonzavod, Rosneft, Transneft or Gazprom Neft.