Vladimir Putin faces “massive consequences” and a “severe cost” if Russian forces invade eastern Ukraine, Liz Truss said, as she led G7 leaders to a tough joint statement on the build-up of troops on the border on Sunday.
The Foreign Secretary hosted her counterparts from six other nations in Liverpool, as they agreed to “stand for freedom and democracy and the right of people everywhere to live free from oppression”.
The Telegraph understands that one sanction under consideration is to restrict the right of Russian nationals to trade in the financial hubs of G7 countries if Mr Putin resorts to military action in the region.
“We have been clear that any incursion by Russia into Ukraine would have massive consequences for which there would be a severe cost,” Ms Truss said, adding that the countries “need to make the positive case for individual humanity and dignity which lies at the heart of our democratic free societies”.
In the joint statement, the countries said Russia must “de-escalate, pursue diplomatic channels, and abide by its international commitments on transparency of military activities”.
Concerns have been raised over a build-up of military activity on the Ukrainian border, with Western states fearing Mr Putin may invade the country.
Western intelligence agencies believe as many as 100,000 troops are amassed at the border, with tanks and artillery, the BBC has reported.
At a press briefing in Liverpool, Ms Truss was also asked about the “billions” of Russian money flowing into London.
She said: “We do already have very strong anti-corruption and anti-money laundering rules in the UK. But let’s be clear, when the UK has wanted to send clear messages and achieve clear goals, we have been prepared to use economic sanctions. So we are considering all options.”
On China, where tension is rising with the US over Taiwan, the Foreign Secretary said that the G7 was concerned about “coercive economic policies” across the globe.
She said the West and its allies want to build investment in “like-minded, freedom-loving democracies”.
The warning to Moscow and Beijing came as Iran said that there would be a “heavy price” to pay for aggressive action against it, as reports began to surface of possible military action if nuclear deal negotiations in Vienna do not progress.
“Providing conditions for military commanders to test Iranian missiles with real targets will cost the aggressors a heavy price,” a military official told Nournews, an Iranian news organisation affiliated with the country’s top security body.
European countries had failed to offer constructive proposals to help to revive a 2015 nuclear deal.
Benny Gantz, the Israeli defence minister, told reporters on Friday that he has instructed the Israel Defence Force to prepare a strike against Iran, adding that he has confidence that the United States will start taking military options more seriously if diplomacy continues to stalemate the negotiations.
Ms Truss warned: “This is the last chance for Iran to come to the negotiating table with a serious resolution to this issue”.
The Telegraph understands that the UK is considering imposing new sanctions on Iran if the regime does not step back from its hardline demands that all sanctions are lifted on the country, which have led to an impasse in the talks.
The UK and Europe say they remain steadfast in using a diplomatic approach to solve the nuclear issue.