THE HAGUE — President Obama acknowledged Tuesday that Russian President Vladimir Putin’s annexation of Crimea would be difficult to reverse, as Russia’s government announced plans to significantly increase forces on the Black Sea peninsula and create new ways to minimize the effect of Western economic sanctions.
Concluding a summit here on nuclear security, Obama warned that broader Russian military intervention in neighboring countries would trigger further economic sanctions that would disrupt the global economy but hit Russia the hardest. He pointedly called Russia a “regional power” acting out of political isolation and economic uncertainty.
Obama dismissed criticism that a perception of U.S. retreat abroad had prompted Putin to seize the Crimea region this month, an act the United States and Europe have said was a violation of Ukrainian and international law. But Obama made clear that Western nations are not contemplating a military response, unless Putin pushes into NATO member nations on Russia’s western border.
“There’s no expectation that they will be dislodged by force,” Obama said in a news conference with Dutch Prime Minister Mark Rutte, who hosted the Nuclear Security Summit. “And so what we can bring to bear are the legal arguments, the diplomatic arguments, the political pressure, the economic sanctions that are already in place, to try to make sure that there’s a cost to that process.”
Obama has sought to galvanize European support here for broader sanctions against Russia should Putin expand his military campaign into eastern Ukraine or Moldova. The United States and six allied powers agreed to deepen Putin’s political isolation this week by effectively suspending Russia’s membership in the Group of Eight industrial nations.
But his comments Tuesday suggested that he does not believe that current sanctions and diplomacy will persuade Putin to relinquish Crimea, which Russia has annexed in response to a hastily called referendum in which a majority of Crimea residents voted to join the Russian Federation.
Obama will take his lobbying effort on Wednesday to Brussels, where he is scheduled to attend the European Union summit and meet with officials from NATO, the collective defense alliance for which he reaffirmed American support here.
He is also scheduled to give what advisers call the “signal speech” of his European trip on the challenges facing what is known as the transatlantic partnership, among them Russian military ambitions that he described as a secondary concern to the United States.
“Russia is a regional power that is threatening some of its immediate neighbors — not out of strength but out of weakness,” Obama said in response to a reporter’s question about whether his 2012 election opponent, Mitt Romney, was right to characterize Russia as America’s biggest geopolitical foe.
“I continue to be much more concerned when it comes to our security with the prospect of a nuclear weapon going off in Manhattan,” Obama said.
Although the Obama administration has long viewed Russia as a regional power, Obama’s words amid the current crisis are likely to anger Putin, who has often bristled at the perceived lack of respect for Russia since the collapse of the Soviet Union.
But Obama noted that U.S. and European unity on matters such as future sanctions, certain to fall hardest on Europe’s economies, would probably be one of the few factors to influence Putin’s thinking. Rutte emphasized that the Russian economy relies heavily on oil and gas exports, a possible target for the “sector sanctions” Obama and European leaders have threatened.
Brushing aside Western sanctions and its suspension from the Group of Eight, the Russian government on Tuesday projected an upbeat mood despite the threats of the American president and European leaders.
Officials outlined plans to modernize and reinforce Russia’s Black Sea naval fleet, based in Sevastopol, Crimea’s main port, and to create a domestic payment system to substitute for international credit cards.
The moves reflected a generally sunny official response to Russia’s increasing isolation, as if the lines are now clear and Russia has a chance to prove that it can go it alone, buck Western economic sanctions and build up Crimea.
Moscow appears intent on addressing a fleet that languished during the years when it shared a base with the Ukrainian navy. Navy officials said they will move to significantly upgrade the force, the Vedemosti newspaper reported Tuesday.
New submarines, aircraft and a motorized infantry brigade will be introduced, the paper said, with the size of the contingent rising from 25,000 to as many as 40,000 personnel. The investment over several years could total about $3 billion.
The Russian Defense Ministry said Tuesday that 40 new warships and support vessels will be joining the navy’s five fleets this year.
Russia has also announced plans to boost pensions and consider tax incentives for Crimea.
Last week, MasterCard and Visa suspended transactions at several Russian banks after U.S. financial sanctions were announced. The suspension has not caused significant disruption, but it has revived plans for a strictly Russian system for making payments. It could involve a domestic system for handling transactions on the leading credit cards, or a new card system altogether.
Through the first days of sanctions, the Russian economy has not buckled. Neither the ruble nor the stock market has declined since a sharp drop in February during the critical weeks of protests in the Ukrainian capital, Kiev, that resulted in the ouster of pro-Russian president Viktor Yanukovych.
Yet there are signs of trouble. Although the Russian economy grew by 0.1 percent in January and 0.3 percent in February, those meager gains are expected to be wiped out by the end of March, the deputy economic development minister, Andrei Klepach, said Monday. Capital flight may reach $70 billion this quarter, he said, more than all of last year.
At a meeting in The Hague on Monday night, Russia rallied support among the BRICS countries — a group of developing nations that includes Brazil, Russia, India, China and South Africa — with a denunciation of sanctions.
Russia said it expects to participate in the Group of 20 meeting in Australia in November, despite warnings that it may not be welcome. Australian Foreign Minister Julie Bishop raised the possibility that Putin might be barred from the summit. Australia has joined other Western nations in placing economic sanctions on dozens of Russian leaders.
Englund reported from Moscow. William Branigin and Ed O’Keefe in Washington contributed to this report.