Hard-hitting European Union sanctions would target state-owned Russian banks and the export of sensitive military goods to Russia, as well as some of Russia's richest people, according to proposals set forth by European leaders today. EU ministers are meeting to discuss further measures against Russia as a response to the crisis in Ukraine and downing of Malaysia Airlines flight MH17 last week. If implemented, it would be the first time European nations have targeted the Russian economy and gone beyond asset freezes and visa bans, according to Reuters.

While European leaders appeared initially hesitant to impose harsh sanctions against Russia, they seem emboldened by the downing of the Malaysia airliner, particularly because the majority of the 298 people killed on board were from The Netherlands. The EU has been threatening Russia with sanctions unless it ensures a full international investigation, and stems the flow of weapons to pro-Russia rebels in eastern Ukraine.

Proposals drawn up by EU governments show a move to block Russia’s access to capital markets, arms, and energy technology, Reuters reports. Concrete decisions on sanctions are expected next week at the earliest. An existing asset freeze list will be added to, and 15 names and 18 entities will be included, ambassadors said, although names of those people have not yet been released. 

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The proposals also suggest that European investors will be banned from “buying new debt or shares of banks owned 50 percent or more by the state,” Reuters reports. One proposal "would consist in prohibiting any EU persons from investing in debt, equity and similar financial instruments with a maturity higher than 90 days issued by state-owned Russian financial institutions after the entry into force of the restrictive measure anywhere in the world," reports The Wall Sreet Journal, quoting from the document. Analysts predict a blow to the Russian economy if the sanctions are officially enacted.

According to The Telegraph, which reviewed the proposals, the sanctions will target businesses worth up to £6 billion a year, and would overwhelming affect the financial sector in Britain. The capital has earned the name “Russky London” for the increasingly large number of billionaires flooding ino the city from Russia, Ukraine, Lithuania, and other former Soviet states.  

Unsurprisingly, an arms embargo for future deals is also being floated. This doesn't apply to the controversial French plan to send a warship to Russia as part of a 2011 contract. As French officials have not yet made a decision on whether to send the second warship in that deal, the embargo could very well apply in that case. Also targeted are “dual-use” military sensitive goods to Russia, according to The Wall Street Journal, and restricting exports of technology for deep-sea drilling, and shale and Arctic energy exploration, according to diplomats quoted by Reuters. 

"In my view the sectoral sanctions against Russia may well trigger a long anticipated end-game of the present global crisis," Russian ambassador to the Britain, Alexander Yakovenko, said during a news conference in London, adding that he considers them illegal.

The sanctions will likely not touch the oil and gas trade from Russia that the EU relies on.