U.S. Treasury No. 2 Adeyemo vows action on tighter Russia sanctions

U.S. Deputy Treasury Secretary Wally Adeyemo speaks at the Royal United Services Institute in London

By Andrea Shalal and Dan Peleschuk

KYIV (Reuters) -U.S. Deputy Treasury Secretary Wally Adeyemo said the U.S. would take all possible measures to pressure the Russian economy as he visited Kyiv on Wednesday for talks with Ukrainian Finance Minister Serhiy Marchenko and other government officials.

Senior White House official Daleep Singh said this week the United States and its partners could broaden current sanctions language regarding financial facilitation, which could point to plans to slap secondary sanctions on those aiding trade with Russia.

"We need to do everything we can to go after that military-industrialised complex using sanctions and export controls, and thinking about what we do going forward has been a big part of our conversations with Ukrainian officials," Adeyemo told a media briefing in the Ukrainian capital.

Since Russia's invasion of Ukraine in February 2022, Washington has sanctioned more than 4,000 individuals and entities, including 80% of Russia’s banking sector by assets.

Washington and its allies were also concerned about the significant support in dual-use goods that China had shipped to Russia’s defense industry, and would continue to raise them directly with China, the official added.

Adeyemo said the U.S. was focusing on ways to work with the Group of Seven leaders to unlock the value of some $300 billion in Russian assets frozen by the West after the start of the war, which would give Ukraine access to more financing in the medium- to long-term.

Earlier this month G7 finance ministers explored ways how to bring forward future income from those Russian assets to boost funding for war-torn Ukraine.

The U.S. has been pushing its G7 partners - Japan, Germany, France, Britain, Italy and Canada - to back a loan that could provide Kyiv with as much as $50 billion in the near term. Instead of seizing the assets outright, such a loan would be backed by pulling forward future interest income on the assets over a set period of time, officials said.

Adeyemo also discussed Ukraine's anti-corruption efforts and highlighted U.S. efforts to help Ukraine continue to attract private investment, including through more public-sector financing.

(Reporting by Andrea Shalal in Washington and Dan Peleschuk in Kyiv; Editing by Lincoln Feast and David Holmes)