LONDON — The U.K. is cutting off all export support for firms hoping to do business with Russia and Belarus in the wake of the Ukraine invasion.
U.K. Export Finance (UKEF), an arm of the British government that offers guarantees and insurance for companies looking to invest or send goods abroad, told POLITICO it was turning off the taps. The government is also banning exports of luxury goods to Russia.
Britain has also cut Russia and Belarus out of preferential tariffs and has published a list of goods worth more than £900 million — including vodka — which will face an additional 35 percent tariff.
UKEF has poured £191 million into support for exports to Russia since 2014, when the Kremlin annexed Crimea, according to analysis from the Labour Party.
International Trade Secretary Anne-Marie Trevelyan said the government was “tightening the screws on Russia to ensure they feel real consequences for their illegal military invasion.”
Former Shadow Trade Secretary Emily Thornberry, who has asked questions about whether U.K. Export Finance would change its approach on Russia, welcomed the move.
“I asked these questions because U.K. Export Finance has an unfortunate history of supporting deals that they shouldn’t, and being too slow to respond to changing circumstances. Unfortunately that has proven to be the case yet again in relation to Russia,” she said.
“I’m glad UKEF have now responded to my concerns by changing their cover policy, but we still need to know whether the taxpayer will have to foot the bill for their past deals with Russian companies, and which ministers signed off on those deals.”
Among the projects U.K. Export Finance has backed in Russia since 2014 is £294,269 in bond support and £1.5 million in export working capital for gas detection equipment for Trolex Limited, and more than £60 million in buyer credit and more than £7.6 million in supplier credit financing to Joy Global for mining equipment.
It is not clear how much U.K. Export Finance will lose as a result of sanctions on Russia.
While U.K. Export Finance is cutting off its support for exports to Russia and Belarus, the office is maintaining its £3.5 billion pot to support exports to Ukraine.
Trevelyan said the U.K. was doing “everything we can to ensure Ukraine remains open to the world. We have signed an international treaty so that U.K. supplies can reach Ukraine and strengthen their defenses, and U.K. Export Finance — our first-class export credit agency — is supporting them with this.”
The changes mark the latest move from the U.K. in the raft of sanctions announced against Russia and Belarus since the invasion began last month.