Aughinish Alumina in sanctions firing line as Senate revisits issue

Vote to be forced on US treasury decision to lift embargo on parent Russian firm Rusal

Russian tycoon Oleg Deripaska is considered close to Russian president Vladimir Putin. Photograph: Ruben Sprich/Reuters

Russian tycoon Oleg Deripaska is considered close to Russian president Vladimir Putin. Photograph: Ruben Sprich/Reuters

 

Senate minority leader Chuck Schumer has said he will force a vote this week on the treasury’s decision to lift sanctions on Russian giant Rusal, the parent company of Aughinish Alumina in Limerick.

The development is the latest sign of growing discontent among Democrats about the decision to lift the sanctions in December. This was a move that was welcomed by several European countries, including Ireland.

“I have concluded that the treasury department’s proposal is flawed and fails to sufficiently limit Oleg Deripaska’s control and influence of these companies. And the Senate should move to block this misguided effort by the Trump administration and keep these sanctions in place,” said Mr Schumer on Saturday.

Democrats are concerned that the treasury’s decision to change its sanction policy towards Rusal signals a softening of approach by the Trump administration concerning Russia and oligarchs close to President Putin. Mr Schumer highlighted, in particular, possible links between Mr Deripaska and Paul Manafort who was Mr Trump’s campaign manager and is central to the Russia investigation.

The European Union has argued that the decision to sanction companies controlled by Mr Deripaska could inadvertently jeopardise European and global aluminium markets and affect the Aughinish Alumina plant in Limerick, which provides 30 per cent of Europe’s alumina.

Ambassadors from several European countries – including Ireland Ambassador to the United States Dan Mulhall – have urged Congress to support last month’s decision to lift the sanctions. In a letter sent to House speaker Nancy Pelosi and Senator Schumer the ambassadors said that, while they recognise the rationale under which Russian oligarchs had been sanctioned, “it is crucial that the sanctions avoid unintended consequences for European companies”.

Aluminum plants “in Austria, France, Germany, Ireland, Italy, Sweden and the United Kingdom have faced increased prices and significant challenges in maintaining their daily operations”, states the letter.

So what will happen?

With Republicans commanding a majority in the Senate, Democrats would need some Republicans to split with President Trump and vote against lifting the sanctions if a ballot is held in the US senate.

Some Democrats, including the chairman of the ways and means committee Richard Neal, have called on treasury secretary Steve Mnuchin to delay the decision. Mr Neal wrote to Mr Mnuchin following a classified briefing on Thursday during which the treasury secretary briefed congressional leaders on the decision to lift the sanction.

Ms Pelosi blasted Mr Mnuchin after the briefing, branding it “one of the worst classified briefings we’ve received from the Trump administration”, despite “stiff competition”.

After the meeting the treasury department highlighted the fact that Mr Deripaska has relinquished control of the company and pledged to ensure that he complies with those terms.

“These entities are undergoing significant restructuring and governance changes that sever Deripaska’s control and significantly diminish his ownership,” said Mr Mnuchin said. “Treasury will be vigilant in ensuring that EN+ and Rusal meet these commitments. If these companies fail to comply with the terms, they will face very real and swift consequences, including the reimposition of sanctions.”