Comparisons to the thirties are by no means overblown – and the City must react
In his address to the nation yesterday, Boris Johnson made a reference both unimaginable just a few weeks ago and one that is now all too relevant. “This is not some faraway country of which we know little,” he said, a reference to Neville Chamberlain’s verdict on the Sudetenland as he readied for appeasement with Hitler.
That it is now possible to make comparisons between the 1930s and the 2020s is a stain on the international order. The sheer pointlessness of the UN. The toothlessness of European leaders’ efforts at jaw-jaw to avert war-war. The warnings that went unheeded time after time about the continent’s reliance on Russian oil and gas. The lily-livered response to the de facto invasion of Crimea and eastern Ukraine, and Georgia’s South Ossetia before that. The tyrant in the Kremlin is responsible for this war, and the death and suffering it will cause, but it is not wrong to say that the effective policy of appeasement towards Vladimir Putin and his cronies has failed, and failed badly.
The sanctions announced by the UK yesterday are tough. They of course have to be. They will entail financial pain for the UK, as well as Russia.
There are now hard questions to be asked of a host of British-headquartered companies who have close links with Russia, and must decide whether to stick or twist; BP chief Bernard Looney, who sits on the board of Rosneft, the Russian oil giant of which BP owns twenty per cent, has more thinking to do than most.
This paper remains firmly of the belief that free trade and free markets are the best route to healthy, vibrant, free democracies. We’d rather business links prosper in spite of politics, because those relationships bring prosperity at either end. They last, and they are worthwhile.
But in our brave new world of ESG metrics and investors talking a good game on responsible business, the City’s links with Russia are not as cut and dry, and perhaps not as mutually beneficial, as they may once have seemed.