The U.K. dramatically stepped up its sanctions against prominent Russians over the invasion of Ukraine on Thursday, freezing the assets of Chelsea Football Club owner Roman Abramovich and six other wealthy business leaders. While that looks set to have major implications on the football pitch, its also another blow to the British capital’s near 50-year run as the plutocrat’s playground of choice.
The latest sanctions follow a concerted effort by Boris Johnson’s government to harm Vladimir Putin’s administration by banning all Russian aircraft from landing and overflying Britain, and prohibiting aviation and space-related exports. The government also said it was planning to phase out all imports of Russian crude oil and oil products by the end of the year, and added to a suite of existing measures that include blocking Russian ships from U.K. ports and sanctions on banks.
Banks may, too, continue to drift away from London if the European Central Bank ramps up its scrutiny of their presence in the bloc, according to BOE Deputy Governor Jon Cunliffe. The ECB may require some business to move back to the European Union following its ongoing review of banks’ booking models and trading desks, he said, adding that firms may respond by moving instead to the U.S. or elsewhere.
Just as war erupts on the continent, a project touted as a symbol of EU cooperation faces a significant setback. The New Generation Fighter combat plane project, first mooted by former German Chancellor Angela Merkel and French President Emmanuel Macron following the 2016 Brexit referendum, has been paralyzed by months of infighting between the leading industry suppliers. Now talks between French defense contractor Dassault Aviation SA and the German and Spanish arms of Airbus SE have reached an impasse.
Finally, as the war in Ukraine fans an escalating cost-of-living crisis in Britain, consumers are more pessimistic about their financial prospects than at any time in at least a decade, a survey by YouGov Plc and the Centre for Economics and Business Research found. The Resolution Foundation suggests people are right to be concerned, forecasting soaring inflation will cause typical incomes to drop by about 1,000 pounds in the coming financial year. Meanwhile, Britain’s most influential fuel lobbyist warned that motorists will also cut back on driving this year by as much as a third to save money, as petrol prices rocket.