Yellen: Russia Should Be Expelled From G20, US May Boycott Some Meetings U.S. Secretary of the Treasury Janet Yellen listens during a panel discussion with women entrepreneurs during her visit to the Mi Casa Resource Centeron in Denver, Colorado, on March 11, 2022. (Jason Connolly-Pool/Getty Images)
David Lawder and Dan Burns Thursday, 07 April 2022 08:32 AM
U.S. Treasury Secretary Janet Yellen said on Wednesday that Russia should be expelled from the Group of 20 major economies forum, and the United States will boycott some G20 meetings if Russian officials show up.
Yellen, who spoke at a U.S. House Financial Services Committee hearing, was referring to an April 20 G20 finance ministers and central bank governors meeting, a Treasury spokesperson said – raising questions about the forum's role in the wake of Russia's invasion of Ukraine.
Since 2008, the club has addressed issues from COVID-19 relief to cross-border debt. It also includes countries such as China, India and Saudi Arabia that have been reluctant to condemn the invasion, which Russia calls a "special military operation."
Yellen told lawmakers that Russia's invasion and the killings of civilians in the town of Bucha "represent an unacceptable affront to the rules-based global order and will have enormous economic repercussions."
The United States and allies have placed greater emphasis in recent months on the G7 grouping of industrial democracies, whose interests are more aligned, using those meetings to coordinate their response to Russia's war.
Yellen said the Biden administration wants to push Russia out of active participation in major international institutions, though it was unlikely it could be expelled from the International Monetary Fund given its rules.
"President Biden's made it clear… that it cannot be business as usual for Russia in any of the financial institutions," Yellen said.
"He's asked that Russia be removed from the G20, and I've made clear to my colleagues in (presidency holder) Indonesia that we will not be participating in a number of meetings if the Russians are there."
Yellen's testimony came as the Biden administration announced a new round of sanctions to punish Russia.
She also warned China – which has given its backing to Russia staying in the G20 – that the Treasury was prepared to turn its sanctions tools against Beijing in the event of aggression against Taiwan, which China claims as a wayward province.
Russia's participation in the April G20 meeting, to be held in Washington on the sidelines of IMF and World Bank meetings, is unclear at present.
Moscow has said President Vladimir Putin intends to attend the G20 summit in Bali in November.
Indonesia, which will also host a G20 finance meeting in July, could not expel or "disinvite" any G20 members, including Russia, a government official familiar with the matter said, adding that whether a country attended was up to that nation.
The new U.S. sanctions against Russia ban Americans from investing there and lock Sberbank, Russia's largest lender and holder of a third of its bank deposits, out of the U.S. financial system, along with other institutions.
But transactions allowing European allies to purchase Russian energy were exempted because many European countries "remain heavily dependent on Russian natural gas, as well as oil, and they are committed to making the transition away from that dependence as rapidly as possible," Yellen said.
A complete ban on oil exports from Russia, the world's third-largest producer, would likely prompt "skyrocketing" prices that would hurt both the United States and Europe, Yellen said.
But she hoped oil companies elsewhere could be enticed to ramp up production which, along with the release of oil from the U.S. Strategic Petroleum Reserve, may allow for tougher restrictions on Russian oil.
Asked if the United States would look to impose sanctions against China if Taiwan was threatened, Yellen said: "Absolutely… In the case of Russia… we’ve imposed significant consequences. And I think that you should not doubt our ability and resolve to do the same in other situations."
Asked about Yellen's comments, Chinese foreign ministry spokesman Zhao Lijian said Taiwan was an "inalienable" part of China's territory, saying Washington was “playing with fire.”