France and Germany do not want to deprive Russian oligarchs of their luxury cars - Politico

Germany and France block part of the new EU sanctions against Russia (photo: Getty Images)

Germany and France oppose efforts by the European Union to close the loophole that allows high-end goods, including luxury cars, to reach Russia through Belarus, according to Politico.

According to three diplomats interviewed by Politico, opposition from Berlin and Paris has prompted EU countries to consider whether to divide the 14th package of sanctions against Russia and similar measures against Belarus in order to reach an agreement before the G7 summit in Italy on June 13-15. This would allow the EU to move forward with the imposition of major sanctions while simultaneously ending the struggle for sanctions against Belarus.

Politico noted that the EU imposed sanctions against Belarus even before Russia's invasion of Ukraine. Thus, Brussels punished Minsk for the falsification of the 2020 presidential elections, in which dictator Alexander Lukashenko claimed victory, suppressing mass protests.

However, sanctions against Belarus have loopholes that have allowed the country to become a transhipment base for sanctioned goods that later reach Russia - the two countries have a common customs union and are closely integrated.

"If we take weak measures on Belarus while we know that goods arrive in Moscow via Minsk, it’s a bit ridiculous," one EU diplomat told Poitico on condition of anonymity.

"The principle is clear: Once a sanction is approved, all loopholes must be closed. When the export of luxury goods to Russia is prohibited, such goods must not reach Russia via third countries," said Zsolt Darvas, a senior fellow at the think tank Bruegel.

Politico noted that a top-class Mercedes limousine is a status symbol for any Russian oligarch or official who respects himself. With flashing blue lights, sirens blaring, and accompanied by SUVs with armed guards, they have long been a familiar sight on the streets of Moscow and other Russian cities.

Russian President Vladimir Putin used to ride in an armored Mercedes Pullman, but a few years ago he switched to the Russian-made Aurus Senat.

Surge in euro imports to Belarus

According to the Ministry of Economy of Germany, in 2023, the import of cars from the EU to Belarus increased to $2.6 billion, which is more than four times higher than in 2021.

Researchers observed the highest relative growth in the luxury car sector, which accounted for two-thirds of the total import increase, amounting to $1.4 billion. Given that this growth contradicts the development of Belarus' domestic automobile market, it is likely linked to further re-export to Russia.

A French diplomat told Politico that Paris advocates for strong sanctions against countries that circumvent sanctions, but said that the main focus should be on goods that serve Russian military efforts.

In a similar context, a German diplomat emphasized that Germany supports decisive measures against sanctions evasion, but the main focus should be on goods related to Russian aggressive war.

Opponents of selling luxury items to Russia argue that Putin wants to keep his elite on his side and maintain his position in the Kremlin by providing his main allies with gourmet food and luxury cars.

EU sanctions against Russia

Since the start of the full-scale invasion in February 2022, the European Union has imposed 13 packages of sanctions against Russia.

Currently, Brussels is working on the 14th package of sanctions against the aggressor state. It will be aimed at closing loopholes for business and opportunities to circumvent restrictions.

Additionally, the EU intends to expand sanctions against Belarus and the regime of Alexander Lukashenko for aiding Russia.