Chinese envoy Shi Mingde warns West against sanctions on Russia

Shi Mingde, Beijing's top envoy to Germany, says punitive measures by West could lead to 'spiral'

PUBLISHED : Friday, 14 March, 2014, 1:02am
UPDATED : Friday, 14 March, 2014, 1:02am

China's top envoy to Germany has warned the West against punishing Russia with sanctions for its intervention in Ukraine, saying such measures could lead to a dangerous chain reaction that would be difficult to control.

This came as the US and Germany stepped up pressure on Russia to back down from plans to annex Crimea, warning that they will exact an economic toll if Russia doesn't.

"We don't see any point in sanctions," ambassador Shi Mingde said. "Sanctions could lead to retaliatory action, and that would trigger a spiral with unforeseeable consequences. We don't want this."

Shi made his remarks as the EU agreed a framework for sanctions that would see travel bans and asset freezes imposed on people and companies accused by Brussels of violating the territorial integrity of Ukraine.

Using her toughest rhetoric since the crisis began, German Chancellor Angela Merkel warned in a speech in parliament that Russia risked "massive" political and economic damage if it did not change course in the coming days.

"If Russia continues on the course of the last weeks, it won't just be a catastrophe for Ukraine," Merkel said. "It would also cause massive economic and political harm to Russia."

Russia's deputy economy minister, Alexei Likhachev, responded by promising "symmetrical" sanctions by Moscow.

But Shi urged patience, saying the door for talks should remain open even after a referendum on Sunday in which Ukraine's southern region of Crimea could vote to secede and join Russia. Merkel and other Western leaders have denounced the referendum as illegal and demanded that it be cancelled.

"We still see a chance to avoid an escalation. The door to talks is still open. We should use this possibility, also after the referendum," Shi said.

President Xi Jinping , who will visit Berlin and other European capitals later this month, had separate phone calls on the Ukraine crisis with Merkel and US President Barack Obama this week. Before going to Berlin, Xi will attend a nuclear security summit in the Netherlands which Obama, Merkel and dozens of other world leaders will attend.

Obama, who met Ukraine's acting prime minister, Arseniy Yatsenyuk, at the White House on Wednesday, signalled the US may not oppose negotiations with the government in Kiev on "different arrangements" for the autonomous region of Crimea in the future.

Russia's defence ministry yesterday announced it had started military exercises near the border with Ukraine, involving 8,500 artillery men.

Meanwhile Dmytro Firtash, one of Ukraine's most influential oligarchs, was under arrest in Vienna and facing possible extradition to the US after being detained in the Austrian capital on a warrant charging him with bribery and other offences.

Firtash was a supporter of fugitive Ukrainian president Viktor Yanukovych and a major player in the sale of billions of dollars in Russian natural gas to Ukraine through a trading company he co-owns with Russian state gas company Gazprom.

Additional reporting by Bloomberg