Russia strikes back hard—Western countries may suffer heavy losses. Is this the straw that breaks the EU’s back?

After the U.S. failed in its attempt to seize all $30 billion of Russia’s frozen assets, it has now reached another agreement with the EU: using the annual income generated from the EU-frozen Russian assets—estimated at €2.5–3 billion—to support Ukraine. Moreover, the U.S. has proposed providing Ukraine with up to $50 billion in loans, backed by the interest accrued on frozen Russian assets! You freeze my assets—that’s one thing. But now you’re even seizing the interest to fund my adversary? That’s simply outrageous. As the saying goes, even a cornered dog will jump over a wall. If you show no mercy, don’t blame me for reciprocating in kind—I’ll demand repayment of both principal and interest. After all, I still hold substantial U.S. assets in Russia—so what do I have to fear? The second reason lies in Russia’s strategic pivot eastward, which has lifted it out of economic hardship and given it the confidence to stand up firmly to the U.S. Let’s examine some data: In 2022, Russia’s GDP contracted by 2.1%—undoubtedly its toughest year. Yet in 2023, GDP rebounded with growth of 3.6%. And in Q1 2024 alone, year-on-year GDP growth surged to 5.4%! Clearly, Russia’s economic reorientation toward Asia—and especially toward China—has revitalized its economy and freed it from dependence on Western economies. Moreover, just prior to this development, Russia and China jointly issued a statement and began intensifying their strategic cooperation—further bolstering Russia’s confidence. The U.S. has already exhausted every conceivable economic sanction against Russia—yet Russia’s economy continues to climb steadily. If not now, then when is the right time to strike back? Since Russia’s countermeasures are primarily aimed at the U.S., why is this move described as the most devastating blow to the EU? Because this is classic Russian ‘feint east, strike west’ strategy. You—the EU—have agreed with the U.S. to use the interest from my frozen assets. And let’s not forget: your frozen assets in Russia far exceed those held by the U.S. Now that I’ve dared to confront the U.S. head-on, next I’ll confront you—the EU—by freezing all EU assets within Russia. According to available data, as of end-2022, direct investments in Russia by the EU, the G7, Australia, and Switzerland totaled $288 billion. In other words, while Russia holds over $200 billion in assets in the EU, the EU likewise holds over $200 billion in assets in Russia. Russia’s move is essentially pressuring the EU: ‘Now it’s your turn to decide how to respond. If your actions displease me, I’ll paralyze your economy too.’ No wonder Russia previously warned: ‘Push us too far, and we’ll cost you at least $28.8 billion in losses.’

European leaders visit China, yet Russia’s foreign minister issues a warning to Europe—does Russia really need to be anxious?

Recently, European leaders have been visiting China one after another. French President Emmanuel Macron and European Commission President Ursula von der Leyen began their visit to China on April 5, engaging in discussions with Chinese counterparts on topics including the Russia-Ukraine war, trade imbalances, and cooperation across various sectors. Prior to them, German Chancellor Olaf Scholz, European Council President Charles Michel, and Spanish Prime Minister Pedro Sánchez had also visited China. While China-Europe cooperation advances, Russian Foreign Minister Sergey Lavrov grew uneasy. In an interview with the Russian weekly newspaper Argumenty i Fakty, he stated that Western countries are attempting to sow discord between Moscow and Beijing by promoting the narrative that ‘Russia depends on China.’ He emphasized that the strategic partnership between Russia and China has significantly deepened—transcending ordinary bilateral relations—and dismissed claims about ‘unequal status’ in the Russia-China relationship as ‘exaggerated by unfriendly countries.’ Lavrov further warned that the deterioration of EU-Russia relations was entirely the EU’s doing; the EU has ‘lost’ Russia, and Moscow will deal with Europe firmly whenever necessary. So why is Russia so anxious about Europe’s deepening cooperation with China—and is such anxiety justified? First, Russia’s diplomatic statements reflect a real concern: the EU harbors motives to drive a wedge between China and Russia—and sees utility in leveraging China to pressure Russia. Moscow has clearly sensed this pressure. Should Western countries fail to end the war through military aid to Ukraine—and remain unwilling to facilitate Russia-Ukraine peace talks—they may instead seek China’s intervention to resolve the conflict: urging Beijing to use its influence over Russia to persuade President Putin to withdraw troops. As for attempts to drive a wedge, citing ‘inequality’ in the Russia-China relationship likely stems from Europe’s misunderstanding of that relationship—and Russia would hardly be overly sensitive to such rhetoric; it’s ultimately a matter of mindset. Second, Lavrov need not be overly anxious—he must see clearly the fundamental nature of the China-Russia-Ukraine triangle. China values both Europe and Russia; the logic underpinning China-Russia friendship remains exceptionally solid.

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