money Yellen: Biden administration will continue isolating Russia until Putin ends war
Treasury Secretary Janet Yellen Wednesday called on other countries to ensure no country monopolizes food or energy supplies in the wake of Russia’s invasion of Ukraine.
“We cannot allow countries to use their market position in key raw materials, technologies, or products to have the power to disrupt our economy or exercise unwanted geopolitical leverage,” Secretary Yellen said at the Atlantic Council on the global economy ahead of the IMF/World Bank Spring meetings. “Let’s build on and deepen economic integration. Let’s do it with the countries we know we can count on.”
The secretary also did not mince words when it comes to isolating Russia.
“Rest assured, until Putin ends his heinous war of choice, the Biden Administration will work with our partners to push Russia further towards economic, financial, and strategic isolation,” she said. “The Kremlin will be forced to choose between propping up its economy and funding the continuation of Putin’s brutal war.”
The Biden Administration has taken numerous actions to sanction Russia along with its Western counterparts to siphon the country off from the global economy since Moscow launched a war on Ukraine in February. Actions have included isolating Russia’s central bank, banning Russian oil, banning new investment in the country, and cutting off its largest banks and state-owned enterprises from the world financial markets.
Yellen also sent a loud message to countries who have not iced out Russia – calling those that are on the fence and may see an opportunity to preserve a relationship with Russia “short sighted.”
“Let’s be clear, the unified coalition of sanctioning countries will not be indifferent to actions that undermine the sanctions we’ve put in place,” she said.
Yellen took direct aim at China for its cooperation with Russia and called on China to make something positive of its relationship with Russia to help end the war with Ukraine.
“China cannot expect the global community to respect its appeals to the principles of sovereignty and territorial integrity in the future if it does not respect these principles now when it counts,” she said.
Yellen said she and her counterparts will talk about the impact of Russia’s invasion during the IMF and World Bank Spring Meetings. She said the U.S. will zero in on how to better support developing countries as global commodity prices spike, posing threats to energy and food supplies. Also on the docket: Maximizing global vaccine deliveries, climate change, and supporting low-income countries.
Yellen again called to impose a global minimum tax on corporate foreign earnings and partially reallocating taxing rights from countries where companies are headquartered to where they sell goods and services.
She also said the IMF and member countries need to come up with a new strategy to get more private capital flowing into developing countries and modernize the development finance system.
“The irony of the situation is that while the world has been awash in savings—so much so that real interest rates have been falling for several decades—we have not been able to find the capital needed for investments in education, healthcare, and infrastructure,” she said.
Making a comparison to the creation of the IMF during WW2, Yellen said, “we ought not wait for a new normal. We should begin to shape a better future today.”
Jennifer Schonberger covers cryptocurrencies and policy for Yahoo Finance. She has been a financial journalist for over 14 years covering markets, the economy and investing. Follow her at @Jenniferisms.
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