Canada joins allies targeting Russian banks, pipeline project over growing Ukraine crisis

Prime Minister Justin Trudeau joined the U.S., U.K., and Germany Tuesday, announcing new and tougher sanctions against Russia,onedayafter President Vladimir Putin formally recognized two breakaway regions in Eastern Ukraine, escalating a security crisis on the European continent.

Trudeau also announced he is sending hundreds more troops to eastern Europe.

The prime minister said up to 460 additional Canadian Armed Forces members are being sent to Latvia and the surrounding region to bolster NATO in the face of Russian aggression.

He also saidCanada is taking a number of steps alongside its allies to isolate Russia financially.

WATCH | Trudeau details Canada's response to Russian actions:

Trudeau announces financial sanctions on Russia in response to escalating tensions in the region

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Duration 1:39

Prime Minister Justin Trudeau announced sanctions on Russian banks and said he'll deploy more troops to the region as Russia continues to pressure Ukraine.

'Flagrant violation'

Trudeau's announcement came after U.S. President Joe Biden announced a first wave of new and tougher U.S. sanctions against Russia Tuesday, following measures imposed byBritain and Germany.

"This is a flagrant violation of international law and demands a firm response from the international community," he said at the White House Tuesday afternoon.

The sanctions, among others things, target Russian banks and sovereign debt.

"That means we've cut off Russia's government from western financing," he said. "It can no longer raise money from the West and cannot trade in its new debt on our markets or European markets either."

WATCH | Sanctions imposed on Russia over latest Ukraine moves:

Russia hit with international sanctions over latest Ukraine moves

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Duration 2:39

Russia was hit with sanctions from multiple countries after recognizing the independence of the Donbas region and was warned of harsher measures if it invades Ukraine, something NATO leaders say is almost a certainty.

Sanctions are being applied to VEB bank and Russia's military bank, Promsvyazbank, which does defence deals, Biden said. Starting on Wednesday U.S. sanctions will begin against Russian elites and their family members.

Tass news agency cited Promsvyazbank as saying the sanctions would not have a significant effect since it had taken precautionary measures ahead of time. It did not give details.

Putin did not watch Biden's speech and Russia will first look at what the United States has outlined before responding, according to Kremlin spokesperson Dmitry Peskov, cited by Russian news agencies.

Biden said he was also moving additional U.S. troops to the Baltic states on NATO's eastern flank bordering Russia. The prime minister of Estonia and presidents of Latvia and Lithuania on Friday had made a direct plea to U.S. Vice-President Kamala Harris for the U.S. to step up its presence in the Baltics.

Earlier, Prime Minister Boris Johnson said the U.K. government would begin imposing fresh sanctions on Russian banks and individualsfollowing Putin's decision to recognize the separatist regions as independent.

German Chancellor Olaf Scholzhas suspended the certification process for the Nord Stream 2 natural gas pipeline in response to the Russian president's decree, which the West fears signals that a full-scale invasion of Ukraineis next.

The undersea pipeline directly links Russian gas to Europe via Germany and is complete but not yet operating. It has become a major target as Western governments try to exert leverage on Russia to deter further military moves against its neighbour.

France has also agreed to respond with sanctions,and Australia also announced Wednesday in Sydney that itwould immediately begin placing sanctions on Russian individuals it believes were responsible over the country's actions against Ukraine.

"Australians always stand up to bullies, and we will be standing up to Russia, along with all of our partners," Prime Minister Scott Morrison said during a briefing. "I expect subsequent tranches of sanctions. This is only the start of this process."

Japan alsoannounced sanctionstargeting Russia and the two breakaway regions in Ukraine.

Prime Minister Fumio Kishida said Wednesday that his government will ban new issuance and distribution of Russian government bonds in Japan in response to the "actions Russia has been taking in Ukraine."

He said Japan will also suspend visa issuance to the people linked to the two Ukrainian rebel regions and freeze their assets in Japan, and will ban trade with the two areas.

U.K. sanctions target banks, individuals

Johnson told the U.K. Parliament that Russia's actions amounted to "a renewed invasion" of Ukraine and said Putin was "establishing the pretext for a full-scale offensive."

In his speech,he announced sanctions against five Russian banks Rossiya, IS Bank, General Bank, Promsvyazbank and the Black Sea Bank as well as sanctions against three wealthy Russian businessmen, Gennady Timchenko, Boris Rotenberg and Igor Rotenberg, freezing their assets and banning them from travelling to or trading in the U.K.

Johnsoncalled the fresh sanctions the "first barrage of what we are prepared to do" and said more sanctions were being prepared by Britain, the European Union and the U.S. if the situation escalatesfurther.

WATCH | How effective are sanctions?

How effective will sanctions be against Russia?

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Duration 2:02

Elizabeth Shackelford, a former U.S. State Department official, says 'the devil's in the details,' but says and that it is crucial that countries, including Canada, work together and co-ordinate their response to Russia's actions.

China called for all parties toexercise restraint, while Japan said it was ready to join international sanctions on Moscow in the event of a full-scale invasion.

The Russian UNambassador, Vassily Nebenzia, warned Western powers to "think twice" and not worsen the situation.

WATCH | Ukraine border city prepares for worst:

Ukrainian border city fears history is repeating with Russia

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Duration 5:26

Many residents of Kharkiv, Ukraine, near the Russian border, are still living with the effects of the war in the Donbas region as they manage fears of a new invasion.

Meanwhile, atop European Union official said Russia's recognition of the Ukrainian separatist regions of Luhansk and Donetsk as independent states and its decisionto send troops into the territories is an "act of war."

Didier Reynders, the European commissioner for justice, said Tuesday the 27-nation bloc is ready to implement sanctions against Russia.

Speaking to Belgian broadcaster RTBF, Reynders said a unanimous accord from EU member countries is needed for new sanctions to be imposed.

He said the anticipated measures would evolve gradually, depending on Russian actions. The first types would be travel bans against individuals and sanctions against economic entities via the seizing of assets in Europe and abroad.

In addition, Reynders said "it will be necessary to ensure that there are no more imports of goods or services from Russia, such as energy, and that Russia's global access to financial services is terminated."

"Everything is on the table," he said, adding member states were discussing how gradual the moves would be and the possibility for diplomacy to ease the conflict.

Russia denies it plans toattack Ukraine

A Reuters witness saw tanks and other military hardware moving through the city of Donetsk on Monday hours after Putin signed a decree formally recognized the breakaway regions and ordered the deployment of Russian forces to "keep the peace." No insignia were visible on the vehicles.

Russia denies any plan to attack its neighbour, but it has amassed troops onUkraine's borders and threatened "military-technical" action unless it receives sweeping security guarantees, including a promise thatUkrainewill never join NATO.

A senior U.S. official said the deployment of Russian troops to the breakaway enclaves did not merit the harshest sanctions the United States and its allies had prepared in the event of a full-scale invasion, as Russia already had troops there.

Russia-backed separatists inUkraine's Donetsk and Luhansk regions collectively known as the Donbas broke away from Ukrainian government control in 2014 and proclaimed themselves independent "people's republics."

Russia needed to ratify its friendship treaties with the two breakaway regions before it could discuss matters like the exact borders of the territories, RIA news agency reported, citing the foreign ministry.

Treaties pave theway for military bases

Russia's parliament ratifiedthose treaties on Tuesday, a step that could pave the way forMoscow to buildmilitary bases in the regions, adopta joint defence posture and tighteneconomic integration.

An explanatory note attached to the documents says theycreate a "legal basis" for the arrival of Russian military units that are needed for "peacekeeping" activities.

Ukrainian President Volodymyr Zelensky, who received a call from Biden to express solidarity on Monday, accused Russia of wrecking peace talks and ruled out territorial concessions.

WATCH | Putin orders troops into 2 breakaway regions in Eastern Ukraine:

Putin stokes tensions with Ukraine, orders peacekeepers into separatist regions

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Duration 5:47

Russian President Vladimir Putin pushed tensions with Ukraine to a new level by recognizing two separatist regions and sending "peacekeepers" in. Residents on both sides of the border are preparing for the conflict to escalate.

Rising fears of a major war in Europe pushed oil prices to a seven-year high on Tuesday, while safe-havens currencies like the yen rallied and global stocks tumbled.The ruble extended its losses as Putin spoke, at one point sliding beyond 80per dollar (US).

In a lengthy televised address on Monday packed with grievances against the West, a visibly angry Putin said that "was entirely created byRussia or, tobe more precise, byBolshevik, Communist Russia."

"This process started practically right after the1917 revolution, andLenin andhis associates did it inaway that was extremely harsh onRussia byseparating, severing what is historically Russian land."

Putin delved into history as far back as the Ottoman empire and expressed frustration that Russia's demands for a rewriting of Europe's security arrangements had been repeatedly rebuffed.

"I deem it necessary to make a decision that should have been made a long time ago to immediately recognize the independence and sovereignty of the Donetsk People's Republic and the Luhansk People's Republic," Putin said.

Putin has for years worked to restore Russia's influence over nations that emerged after the collapse of the Soviet Union, withUkraineholding an important place in his ambitions. Russia annexed Crimea fromUkrainein 2014.

A French presidential official said the speech "mixed various considerations of a rigid and paranoid nature."