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Putin Bides Time as U.K. Allies Demand Spy Attack Explanation

Key U.K. allies called the attack a violation of British sovereignty.

Putin Bides Time as U.K. Allies Demand Spy Attack Explanation
Road traffic forms congestion on a highway beside the Moskva river and Kremlin, right, in the early evening in Moscow, Russia.  (Photographer: Andrey Rudakov/Bloomberg) 

(Bloomberg) -- The leaders of the U.S., Germany and France said all evidence points to Russia being responsible for the poisoning of two people in England and called for an urgent explanation from Vladimir Putin’s government.

In a joint statement with the U.K. issued in Berlin Thursday, President Donald Trump, Chancellor Angela Merkel and President Emmanuel Macron said they were “horrified” by the attack on Sergei Skripal and his daughter and that there’s “no plausible alternative explanation” to Russian responsibility. Russia’s actions since the poisoning “underlines” that conclusion, they said.

The incident, involving the first use of nerve agent in Europe since World War II, “threatens all of our security,” the leaders, including Prime Minister Theresa May, said in the statement that landed 24 hours after the U.K. first unveiled its response to the attack.

Ratcheting up their rhetoric, the key U.K. allies called the attack a violation of British sovereignty: “We call on Russia to respond to all questions connected with the attack in Salisbury.” The southern English town where the attack took place on a Sunday afternoon and could have exposed as many as 500 people.

“It’s an important statement from the leaders of the West that they don’t buy this Russian nonsense and disinformation,” Gustav Gressel, senior policy fellow at the European Council on Foreign Relations in Berlin, said in an interview. “But a statement is not enough, tangible action is needed.”

Putin Still Quiet

Putin, who is scheduled to make a speech on Thursday evening, has yet to retaliate after May announced the expulsion of 23 diplomats and a raft of other measures against Russia on Wednesday. The president is deliberating over how to react to the U.K.’s “absolutely irresponsible” behavior, Kremlin spokesman Dmitry Peskov told reporters on a conference call Thursday.

Foreign Minister Sergei Lavrov said the response will “certainly” include sending home British diplomats, the state-run RIA Novosti news service reported. Lavrov accused the British government of using the incident to distract from its failure to gain ground in Brexit negotiations, and said others may use it to undermine Russia’s hosting of the soccer World Cup this year.

Deja Vu

The last time the two nations faced a similar situation was back in 2006, when ex-Russian agent Alexander Litvinenko died from radiation poisoning. The U.K. response was widely criticized from being too weak. The Kremlin dismissed allegations as nonsense. Months later the U.K. moved to expel four diplomats, and Russia retaliated days later by kicking out the same number of British embassy staff.

This time, the stakes are much higher. In the intervening years Putin has turned his back on the West, intervened in Syria to prop up the Assad regime and annexing Crimea in the face of international condemnation. He’s also suspected of meddling in the U.S. presidential election.

British lawmakers have been infuriated by Russia’s apparently flippant response to the allegations, with May accusing them of treating the incident with “sarcasm, contempt and defiance.” Defence Secretary Gavin Williamson said Russia “should go away and should shut up,” in a speech on Thursday.

The Russian Embassy in London tweeted a photograph of a thermometer surrounded by ice with the caption: “The temperature of Russia U.K. relations drops to -23, but we are not afraid of cold weather.”

As a member of the United Nations Security Council, Russia has a responsibility to maintain international peace and security, the four powers said. Russia rejected the U.K.’s demands for an explanation, denying any role in the attack, which has left the Skripals in critical condition.

Samples

Moscow accused the British government of failing to follow the proper procedures for investigating such an allegation. The U.K. said samples of the nerve agent will be made available to the Organisation for the Prohibition of Chemical Weapons for testing.

Russian assets retreated as international condemnation gained strength, yet the government is pushing ahead with a Eurobond sale even as the diplomatic spat escalates. The offering of dollar debt closes tomorrow, according to a person with knowledge of the matter. The Finance Ministry has said it will give priority to local investors willing to repatriate funds, which may provide shelter for Russian money currently being stashed in the U.K.

May told Parliament Wednesday that the U.K. will move to freeze Russian state assets. More steps will be taken in secret, she said, a hint that Britain could launch cyber-attacks on Kremlin interests. Other wide-ranging responses, such as financial sanctions or preventing Russian banks from using the SWIFT international payments messaging system, require multilateral support and time.

Bill Browder, chief executive officer of Hermitage Capital, said Britain should concentrate its response on targeting the assets of Russian officials in London, where many have property holdings.

“The main thing Putin cares about is his own money, and the money of the people around him,” he said in a telephone interview. “Britain has huge leverage because of all the Russians with their money here. They should use that.’’

--With assistance from Torrey Clark Tim Ross Iain Rogers Kitty Donaldson and Stephanie Baker

To contact the reporters on this story: Thomas Penny in London at tpenny@bloomberg.net, Tony Czuczka in Berlin at aczuczka@bloomberg.net.

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Flavia Krause-Jackson, Stuart Biggs

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