Russia slapped import bans on an array of food goods from the U.S. and Europe and threatened to target the automotive, shipping and aerospace industries, striking back at sanctions over the conflict in Ukraine.

The restrictions include all cheese, fish, beef, pork, fruit, vegetables and dairy products, Prime Minister Dmitry Medvedev told a cabinet meeting today in Moscow. Russia may also impose “protective measures” on the aviation manufacturing, shipbuilding and auto industries, he said. The curbs target nations that sanctioned or supported punitive measures against Russia and also include Canada, Australia and Norway.

“The decision on retaliation wasn’t easy for us,” said Medvedev, who announced a ban on Ukrainian planes flying over Russia and a review of the use of Siberian air space for other carriers. “But I’m sure that even under such conditions we will be able to turn the situation to our own benefit.”

Russia is embroiled in the worst standoff with the U.S. and its allies since the Cold War over Ukraine, where government troops are cracking down on pro-Russian insurgent strongholds in the east and Russia’s military is massing thousands of troops across the nearby border. The U.S. and the European Union have targeted Russia’s economy, expanding penalties last week, joined by Canada, Japan and Switzerland, after the downing of a Malaysian Airline System Bhd. jet in a rebel-controlled area.

The Micex Index fell to a three-month low in Moscow, declining 1.6 percent and extending this year’s drop to 12.7 percent, data compiled by Bloomberg show. The ruble weakened 0.6 percent to 36.3767 per dollar, its lowest level since March, when Putin annexed Ukraine’s Black Sea peninsula of Crimea.

David Fuller's view

The obvious point, which most people realise and this service has mentioned repeatedly, is that sanctions are a painful and lengthy means of dealing with serious international disputes which have not been resolved by diplomatic efforts.  The underperformance of Europe’s stock markets since June highlights these concerns.

Nevertheless, if sanctions against Russia are justifiable, and I have advocated them for several weeks, this is infinitely preferable to a serious military conflict which would be far greater than what we are currently seeing between Russia and Ukraine.  Most importantly, sanctions are also preferable to appeasement which only emboldens dictators such as Putin. 

Some American and European commentators say the West has unnecessarily and provocatively stoked the Ukraine versus Russia problem.  They say the West has threatened Russia by moving NATO into Eastern Europe, allowing former countries previously ruled by the Soviet Union to become members of the EU, and by encouraging the majority separatist movement within Ukraine.  Well, most people aspire to be part of the free world and those Western commentators have no right or authority to hand the Ukraine or any other Eastern European region or country over to Putin’s Russia.  Moreover, this is more about Putin and his old world KGB cronies than the average, educated Russian.  They would vote for a move towards genuine democracy, if given the chance.  A democratic Russia, rather than a dictatorship longing to control more of Eastern Europe, would have a secure future within greater Europe.