Background Press Call on President Biden’s Meetings with the G7 and the European Council

 Via Teleconference

12:08 P.M. CET

MODERATOR:  For the second section, which is embargoed until 2:15 p.m. Central European Time/9:15 a.m. Eastern time, I’ll turn it over to you [senior administration official] to get us started.

SENIOR ADMINISTRATION OFFICIAL:  Thanks, [senior administration official].  And let me follow up from [senior administration official] and just preview some of the G7 discussions, in particular the actions we have planned on sanctions.

So, today the U.S. will sanction Russian elites, the Duma, and over 300 Duma members, and over 40 Russian defense companies.  All of this will align and strengthen our sanctions in close coordination and partnership with the EU and G7.

     The G7 and EU will also announce a new sanctions evasion initiative that’s designed to prevent circumvention or backfilling of our unprecedented measures.  And that will happen through closing down avenues, for example, for the Russian Central Bank to prop up the ruble.  It could be through growing our coalition of countries to deny cutting-edge technology to Russia, or through preventing Russia from designating crony banks to do it business abroad.

In all cases, we’ll use this initiative to share information and coordinate our responses to prevent the emergence of any safe haven for Russia, whether it’s in China or any other country.

Third, the G7 and the EU will also continue to blunt the Central Bank of Russia’s ability to deploy international reserves by making clear that any transaction involving gold related to the Central Bank of Russia is prohibited.

And for context: As of June of last year — the last official snapshot of Russia’s Central Bank reserves — gold was 20 percent of the total.  And our purpose now is to fully disarm its war chest by making sure its foreign reserves serve no purpose in propping up the Russian currency.

And finally, we and the G7 will join together in saying that international organizations and multilateral fora should no longer conduct their activities with Russia in a business-as-usual manner. 

Our purpose here is to methodically remove the benefits and privileges Russia once enjoyed as a participant in the international economic order.  And this follows our actions to remove Russia’s most-favored-nation trading status and to suspend its borrowing privileges from the IMF and the World Bank. 

     You all have the factsheet, so I won’t get into all the detail on the specifics, but let me just step back and put all these actions into context.

All of you will remember that well before Putin invaded Ukraine, we warned that he would face the most severe sanctions ever levied on Russia and ever imposed on a large market economy.  We also warned that we would respond to an invasion with unprecedented speed and with a historic degree of coordination.

Over the past month, we’ve done exactly what we said we’d do.  Judging from the words and actions of the Russian leadership, this caught the Kremlin by surprise.  Putin himself said these sanctions are delivering a profound blow; they’re causing “unprecedented” pressure, in his own words.  And yesterday, Minister Lavrov said no one could have predicted the actions we’d take.  But the reality is these are precisely the consequences we’ve signaled.

And the consequence is that Russia is now looking at a contraction in its economy of 15 percent this year, according to private sector estimates.  To put that into perspective, that would be three times as much as the GDP declined after Russia’s debt default in 1998.  The Institute for International Finance estimates that the shock to Russia’s GDP this year will wipe out the past 15 years of economic gains. 

Meanwhile, the OECD projects that inflation will spike to 15 percent this year in Russia.  More than 400 private sector companies have already quit Russia.  And independent observers estimate that over 200,000 people emigrated from Russia just in the past month alone, as the brain drain accelerates. 

Set against the backdrop of export controls that deny cutting-edge technology and its removal from international supply chains, Russia will soon face an acute shortage of ideas, talent, and technology to compete in the 21st century.  And Putin will be left with a strategic failure of his own making.

Let me turn it now to [senior administration official].  Sorry, I guess I’ll take Q&A before turning it to [senior administration official] on refugees, if that’s all right, [moderator].

MODERATOR:  Absolutely.  We’ll open it up for a couple of questions for [senior administration official].  If you can please indicate you have a question by raising your hand on the Zoom.

     We’ll start with James Politi from the Financial Times.

Q    Hi there.  Thanks.  I was wondering if you could talk a bit more about energy and the sort of joint strategy that we expect to be announced tomorrow, if possible.

SENIOR ADMINISTRATION OFFICIAL:  Hi, James.  Yeah, you know, I actually would rather — or not — I’d rather not get ahead of that announcement.  It’s premature to go into detail, but I guess I’ll just let you know it’s something we’ve been working on for some time, and I think it’s going to be a meaningful step forward in terms of accelerating Europe’s diversification away from Russian gas and our collective phasing out of gas, both in the U.S. and Europe.  So, please stay tuned on that front.

MODERATOR:  Thank you.  And for our next question, we’ll go to Daniel Bush from Newsweek.

Q    Hi, sorry about that.  Thank you.  I wonder if you could just step back a little bit.  We’re seeing these sanctions having a huge impact on the economy, as you pointed out in all these different ways.  What impact do you see it having on Putin’s ability in the short and medium term to continue carrying out the war on the ground in Ukraine, especially if Russia is continuing to get revenue from oil and gas exports?  Thanks.

SENIOR ADMINISTRATION OFFICIAL:  Yeah.  Well, you know, first of all, in oil and gas exports, if you look at Russia’s oil receipts, they are down.  Estimates from the private sector suggest that roughly two to two and a half million barrels of Russian oil are no longer making it to their intended destination.

But, you know, look, if you consider the aggregate impact of these sanctions, what we’re doing is really depleting President Putin of the resources that he needs to conduct this war.  He’s looking, as I mentioned, at a contraction in his economy; you know, some people estimate 10 percent, others 15 percent, other people say more.  That is three times larger than the contraction Russia faced after it defaulted in 1998.  Russia used to be the 11th largest economy in the world before its invasion. 

If you consider the depreciation of the ruble already and the projected shrinking of its economy, it’s now looking at an economy half of the size that it was before this invasion.  So it would fall out of the top 20 economies by ranking.

At the same time, we’re cutting off all of the sources of potential growth in Russia, whether it’s cutting-edge technology, or whether it’s access to supply chains from the West, or human capital.  You know, people are leaving Russia by the droves, especially the best and brightest.

All of this will inhibit his ability to continue to execute a military operation and to have sources of growth outside of oil and gas.

Now, we can’t predict exactly when or how this will change Putin’s calculus.  But what we can ensure is that this is going to be a failure; he’s going to emerge weaker, and we’re going to emerge stronger.

SENIOR ADMINISTRATION OFFICIAL:  Thank you.  And next we’ll turn to Tamara Keith from NPR.

Q    Hi.  Unmute.  So sorry.  I just wanted to clarify whether all of these sanctions are being done in conjunction with Allies or whether this is the U.S. moving on its own, and just the — just the sanctions evasion part is done — being done in coordination today.

SENIOR ADMINISTRATION OFFICIAL:  Hi, Tamara.  So, the sanctions on individuals — as I mentioned, we’re sanctioning 300-plus members of the Duma, a handful of financial elites and oligarchs.  Many of those measures are aligning the U.S. sanctions with those of the EU or G7 partners.  And they’re also taking steps to align with our measures.  So, that’s — that’s an effort at strengthening our coordinated action.

The other measures I mentioned are being taken by the G7-EU as a whole.  So the sanctions evasion initiative is something that you’ll see in the G7 statement.  You’ll also see language in the G7 statement about prohibiting any transactions with Russia’s Central Banking goal.

And we’re also going to say together in the G7 statement that it’s not — it cannot be business as usual anymore for international organizations or multilateral fora.

So, the overall message here is: We have taken historic steps in imposing costs on Russia.  Now let’s make sure we’re fully aligned and we’re getting the maximal impact from the measures that we’ve implemented.

MODERATOR:  Thank you.  And next we’ll go to Phil Mattingly from CNN.

Q    Hi, guys.  Thanks for doing this.  Hey, [senior administration official], on the sanctions evasion piece of it that you’re working with on the G7 — I guess, to start, can you give some examples of, over the course of the last four weeks, places where you’ve seen gaps or seen areas that could be exploited that will be closed by what you’re doing right now?

     And I guess, more broadly, conceptually, how have you approached putting the sanctions evasion piece together?  Is it purely through what you’ve seen in asset flows or what you’ve seen in gaps, or is there kind of a broader methodology to it?

SENIOR ADMINISTRATION OFFICIAL:  Hi, Phil.  Yeah, I’ll give you a couple of examples — and, actually, one of them is gold.  So we’ve heard market chatter that Russia is still using — trying to use its gold reserves to prop up the ruble — so, selling its gold in order to buy ruble. 

     It still has a considerable amount of gold; estimates are that it’s somewhere between $100 billion to $140 billion in market value.  We don’t know for sure because the last snapshot of Russia’s Central Bank reserves was from last June.  And so that’s roughly 20 percent of the total reserves that Russia held prior to the invasion.

     We want to shut down any ability for Russia to use its gold to support its currency.  And we need to do that as a G7 for it to be effective.  And so that’s an example of working together to prevent any circumvention of our sanctions measures. 

     Another is on export controls, Phil.  So, as you know, we have collectively denied the inputs for foundational technologies to Russia, whether it’s semiconductors or artificial intelligence or quantum or hypersonic flight. 

     And we, in the West and the EU, produce and design many of these inputs, but so do our partners in Asia.  And we just need — we want to make sure that for any of these technologies, including technologies that may be produced in China or designed in China, that we’re shutting down avenues for Russia to benefit from continued transactions with those countries too.

MODERATOR:  Great.  And next we’ll turn it over to [senior administration official] to do an overview of our refugees announcement, followed by [senior administration official] to do a preview of the European Council meeting, after which we’ll open it up for more Q&A.

SENIOR ADMINISTRATION OFFICIAL:  Great.  Thank you.  And good morning, everyone.  We’re happy today to share that the United States is announcing that we will welcome up to 100,000 Ukrainians and others fleeing Russia’s aggression. 

     To meet this commitment, we are considering the full range of legal pathways to the United States.  So that includes the U.S. Refugee Admissions Program, parole, and immigrant and non-immigrant visas. 

     We’re going to have more details to share on this program in the days and weeks to come.  But I would note today that we’re working, in particular, to expand and develop new programs with a focus on welcoming Ukrainians who have family members in the United States.  And I think we’ve all heard from many in the diaspora that they are eager to welcome their Ukrainian family members into their homes in the United States as quickly as possible. 

     We’re also committed to protecting the most vulnerable among the refugee populations that have already fled, and that includes LGBTQI+ individuals, those with medical needs, third-country nationals who have already sought refuge outside of the — in Ukraine — excuse me — journalists, dissidents, and others who have specific vulnerabilities. 

     And we’re, of course, coordinating our effort closely with our European allies and partners who are on the frontlines of this refugee crisis. 

     We still expect most displaced Ukrainian citizens will want to stay in neighboring countries or elsewhere in the EU where they may have family and where there are already large diaspora communities in the hope that they can return home soon. 

     But at the same time, we recognize that some number of Ukrainians who have fled may wish to come to the United States temporarily, especially those with family in the U.S. 

     By opening our country to these individuals, we will help relieve some of the pressure on the European host countries that are currently shouldering so much of the responsibilities for what is the largest refugee crisis in Europe since the Second World War.

     We commend our European allies and partners for keeping their borders open to those that are seeking international protection.  And as [senior administration official] noted, we are particularly grateful to Ukraine’s neighboring countries, including Poland, Romania, Slovakia, Moldova, and Hungary, who have opened their doors and set up welcome centers for the nearly 3.5 million who have fled Ukraine to date. 

     The United States is and will continue to be a global leader in international humanitarian — in international humanitarian response.  And we are asserting humanitarian assistance to provide immediate support for those on the ground in Ukraine and for those who are fleeing Ukraine and dealing with the catastrophic humanitarian consequences that Moscow and Moscow alone is responsible for. 

     And with that, I’ll turn it over to [senior administration official] to preview this afternoon’s EC meetings and our announcements on new humanitarian assistance. 

[Senior administration official], over to you.

SENIOR ADMINISTRATION OFFICIAL:  So, thanks for that, [senior administration official].  And, yes, just to round out the day, you know, I think this is a banner day of multilateral meetings, starting here at NATO, moving to the G7, and then we will be driving across town for meetings with the EU. 

The President, this afternoon, will be joining the European Council meeting.  That is a fairly regular gathering that the 27 EU heads of state and government have.

You may remember that, almost a year ago to the day, the President joined a meeting of the European Council.  This was very early in the administration.  He joined it virtually.  And this will be the first time in the administration that the President will have sat down with all 27 of the EU heads of state and government in person. 

     Obviously, some of those countries — many of those countries, in fact — are here at the NATO summit.  But there’s also an opportunity for him to engage with a number of other countries who are in the EU but not at NATO.

The President will be greeted by Charles Michel, who is the President of the European Council.  And then they will have a short bilateral meeting at the top.  And then President Michel will escort President Biden into the meeting where he will be then meeting with the 27 EU leaders. 

     They will then continue on after the President leaves for their own previously scheduled meeting later this afternoon and dinner and then probably much of the day tomorrow. 

     But we really felt that, in addition to the NATO meeting, it was important for the President to have the opportunity to engage directly with his EU counterparts as well. 

     One of the main things I think they will discuss is sanctions.  [Senior administration official] obviously did the broad laydown of sanctions, including new measures that we are looking at today.  And so, in addition to the coordination that we’ve had with the G7, I think it’s important to underscore the very close cooperation that we have had with the European Union generally over the last year.

     In terms of our approach to sanctions, our aim has always been to work in lockstep with the EU to the extent possible.  But I think, particularly over the last month, we have tried to be as closely coordinated with the EU as we could, both in the development and the rollout of our sanctions packages.  So this will be a good opportunity for the President to talk directly with EU leaders about that. 

     Second, I think the leaders will have a significant conversation about the refugee crisis as well as the humanitarian assistance that we are all providing.

     Obviously, a very clear recognition by the President that a number of these eastern flank countries, including Poland, Romania, Slovakia, Hungary, as well as some non-EU members, including Moldova, are very much on the frontlines of this.  And so I think the President will welcome the opportunity to hear from a number of these countries that are facing these immediate flows of refugees, as well as to hear from a range of EU countries that are taking in a number of refugees. 

     Those of you that were covering St. Patrick’s Day last week will have heard the President talk with the Irish Taoiseach about the 7,000 refugees, for example, that Ireland has taken in, which is an example of how various EU member states are stepping up to deal with the humanitarian assistance piece.

Third, and related more broadly to the Eastern Partnership, which is what the EU calls these countries on their eastern side — the Caucasus, Moldova, Belarus, Ukraine — the leaders are expected to discuss democratic resilience: the need to continue to bolster the ability of these countries to stand strong in the face of some of these autocratic pressures; to underscore the democratic developments that are happening in a lot of their countries; and to ensure that we are working together with the EU to support their resilience, especially at this particular moment.

     And finally, I would expect that the leaders will have some discussion of energy security along the broad lines of the G7 talks that [senior administration official] outlined, as well as food security.  Food security is an increasing concern for the EU, similar to what it is at the United States.

     So, coming out of the President’s meeting with the European Council, we are anticipating the announcement of a number of deliverables and new announcements.  So, let me run through what those are now, as they are related specifically to the conversation that the President is going to be having with his EU counterparts.

     First, we’re prepared to provide more than $1 billion in new funding towards humanitarian assistance for those affected by Russia’s war in Ukraine and its severe impacts around the world.  So, this funding will be additional to money that we have already provided, and will provide food, shelter, clean water, medical supplies, and other forms of assistance.

     Second, a new commitment to defend global food security.  Russia’s war of aggression threatens to disrupt the supply of critical agricultural commodities from the Black Sea region, which jeopardizes global food security, particularly for vulnerable populations in the Middle East and Africa. 

Ukraine, known globally for its wheat production, for being a “bread basket” for the world, obviously is very much hindered in its ability to do that during this harvest season given the fact that you have Russian tanks rolling across Ukrainian fields and you have Ukrainian farmers who have taken up arms to defend their country.

But the United States, through the Feed the Future initiative and our nutrition commitments, will be providing over $11 billion over the next five years to address food security threats and malnutrition across the globe.  And this includes programming in many of the countries that are vulnerable to increases in food and fertilizer prices.

     The third thing to highlight is that today we will be launching a European Democratic Resilience Initiative.  This initiative will be launched with $320 million in funding.  The aim of this initiative is to defend human rights, to strengthen democratic and anti-corruption institutions, to support media freedom, and to increase accountability for human rights abuses and violations of international law.

     And as I mentioned, there will be a particular focus of these efforts on these countries neighboring the European Union who are currently vulnerable in this space.

So, an important component of this will be support for efforts to document and preserve evidence of potential war crimes being committed in Ukraine.  The United States is already supporting several such initiatives.  And as I mentioned, this will be an opportunity for the President to talk with EU counterparts about ways in which we can collaborate with the EU on these efforts. 

Some new lines of efforts, including the establishment of a conflict observatory, will gather information that can be shared with a range of accountability efforts at the national and international level to hold Russia accountable for its actions.

     So, [moderator], let me stop there.

MODERATOR:  Great.  Thank you.  And now we’ll open it up for Q&A for [senior administration official] or [senior administration official].  If folks could please raise your hand using the Zoom function. 

And we’ll get started with Michael Shear from the New York Times. 

Q    Hey, guys.  Question, I guess, for [senior administration official] about the 100,000 refugees.  As you know, obviously the President said, I think last September, that the cap for refugees — for the refugee program for the entire world would be 125,000.  Very few of those have actually come in.  Is the 100,000 going to be part of that 125?  Is this an additional 100,000?  And do you have to go to Congress to consult for that, or can those just simply come in through the IRAP program?

SENIOR ADMINISTRATION OFFICIAL:  Yeah, thank you for the question.  So, a couple of things on this. 

One, not everyone that comes in under this program would come in as a refugee.  Like I mentioned, people could come in as refugees under — or under humanitarian parole, or using immigrant or non-immigrant visas.  So, there’s multiple pathways there.  And obviously, only those that came in as refugees would be counted against that ceiling of 125,000.

I’ll also note that the ceiling of 125,000 is for fiscal year 2022.  And this commitment of 100,000 is not necessarily timebound to that fiscal year; it’s a broader commitment. 

But I will say that, you know, we have still a significant capacity within the 125,000, so we don’t currently envision the need to go beyond that in terms of the portion of the individuals that would come in as refugees during this fiscal year.

SENIOR ADMINISTRATION OFFICIAL:  Thank you.  Next we’ll go to Geoff Earle with the Daily Mail.

Q    Hey, guys.  Thanks.  This is a little bit circling back to earlier in the call, but I was wondering if with President Zelenskyy or some of the other leaders, if there’s been any discussion of prospects for a negotiated settlement.  Because I know a lot of the military aid is — you know, one aim is to try to force the Russians back to the table.  And so, is this, you know, realistic? 

And also, Zelenskyy keeps talking about reparations.  Is there going to be an effort to acquire, you know, this impounded money from Russia to go toward that?  Thank you.

SENIOR ADMINISTRATION OFFICIAL:  Thanks very much for that question.  And I don’t have anything new on this beyond what we have talked about in the past, which obviously is continued support for the Ukrainians in their effort and, most importantly, to get the Russians to agree to a ceasefire, especially considering the very dire humanitarian situation that we’re seeing in a number of parts of Ukraine. 

     So far, we have not seen a serious readiness on the part of Russia, certainly, to engage in a ceasefire or even necessarily to engage in serious conversations. 

     Certainly, if we get to that point, we can look at a broad range of scenarios.  But for right now, the focus very much remains on getting to a ceasefire so we can support the people that are suffering.

MODERATOR:  Thank you.  Next we’ll go to David Sanger with the New York Times.

David, if you’re there, please unmute.

Q    Sorry about that.  Can you hear me now?  Okay.  My question is for [senior administration official], and the question has to do with the European Democratic Resilience plan. 

     [Senior administration official], is this the kind of plan that the President had in mind when he was first talking about autocracy versus democracy?  Or is this specifically tailored to the Russian invasion and so forth?  I’m trying to figure out the degree to which you think you have new threats to democracy in the region because of this versus what you faced before?

SENIOR ADMINISTRATION OFFICIAL:  Thanks, David, for that question.  So this European Democratic Resilience Initiative is something new that we are standing up to try and provide additional support to countries in the region. 

I think our approach to the Ukraine crisis more broadly, as I said at the top, has been multifaceted, both in terms of imposing economic costs on Russia, supporting the people of Ukraine, defending the security of the NATO Alliance.  And I think you could add a fourth line of effort to that that’s been implicit in what we’ve done, as well as in what the EU has done, which is to take steps to bolster the resilience of countries in the neighboring region.  This is something that I heard a number of leaders mention in passing in the NATO interventions earlier today. 

The EU and the United States, they’re obviously very concerned about the situation in Moldova, in terms of refugees.  And a strong desire to ensure that we are doing everything possible to bolster the resilience of those countries as well — the ones that are not in NATO or the EU but that are, in EU parlance, part of their Eastern Partnership Program and on the eastern part of the European flank. 

     So we’ve already done a lot with Moldova in terms of Secretary Blinken and others making visits there, with a very strong focus on what we can do on the humanitarian assistance side. 

     The United States has long worked on democratic programs in all of these countries, frankly.  The EU also has programs in all of these countries as part of the Eastern Partnership Program. 

     But I think — and then, you know, to take your question more broadly: As you rightly said, the President has been, for his entire administration, very focused on these broader questions of democracy and autocracy as well.  And it’s very much played out in the President’s Democracy Summit where we had participation from countries like Moldova and Georgia, among others.  It very much ties into what we are trying to do in this democracy “year of action” coming out of the Democracy Summit.  

     But this specific program that we are launching today is targeted at the countries within this region, with a very specific desire to try and shore up their democratic institutions, their anti-corruption institutions; to support media freedom; as well as accountability for human rights abuses. 

     And part of this is based on the theory that one of the best things we can do for all of these countries and to increase the resilience and security of these countries, as well as our own countries, quite frankly, as the President has talked about, is to ensure that we’re doing everything we can to shore up the democratic resilience, the good governance, and the rule of law measures there. 

     And then, as I mentioned, there is also an increasing focus on the potential for war crimes in Ukraine and wanting to ensure that we are doing everything we can to be supporting the collection of information there so that that can be fed into broader accountability mechanisms. MODERATOR:  Great, thank you so much.  And with that, those are all the questions we have time for, so we have to wrap. 

     As a reminder of the ground rules, this call was conducted on background, attributable to a senior — to three “senior administration officials.”  And as a reminder, the second portion of the call is embargoed until 2:15 p.m. local time or 9:15 a.m. Eastern time.  Thank you very much.

12:39 P.M. CET

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