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U.S. and Allies Slap Russia with Tough Sanctions; Ukraine Stand Ready to Fight Their Sovereignty; Russia and Ukraine Responds to Polling; Russia/Ukraine Tension Affects Markets Worldwide; Hong Kong Ramps Up COVID Testing; Fourth Named Storm In A Month Hits Madagascar. Aired 3-4a ET

Aired February 23, 2022 - 03:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[03:00:00]

(COMMERCIAL BREAK)

MICHAEL HOLMES, CNN ANCHOR (on camera): Hello, everyone. I'm Michael Holmes coming to you live from Lviv in Ukraine.

Coming up this hour, new sanctions against Russia as troops continue to amass on Ukraine's border. U.S. President Joe Biden describing this as the beginning of an invasion.

ROSEMARY CHURCH, CNN ANCHOR: And I'm Rosemary Church live from CNN world headquarters in Atlanta.

Hong Kong announces its toughest COVID restrictions yet after a surge of new cases, we will bring you a live report.

HOLMES: Welcome everyone, the U.S. and its allies moving to punish Russia with sanctions as Moscow escalates its military threats over Ukraine. Japan and Australia are among the latest to announced new sanctions aimed at deterring Russia from further invasion.

And now Russia has hit back, calling some of the west sanctions illegal, and saying that the impacts will be felt beyond Russia's borders. The Russian president, Vladimir Putin also responded in a video message just posted by the Kremlin. Recipient says Russia is still open to dialogue with the west, but added that Russia's interests and security are, in his words, nonnegotiable.

Meanwhile, new video shows more Russian military vehicles arriving near Ukraine's border. So far, CNN cannot confirm that any troops have actually crossed into Ukraine, but E.U. and NATO officials say Russian forces have already arrived.

And new satellite images showing more Russian troops and military equipment deployed to the Ukrainian border. And Ukraine's president, meanwhile, saying Moscow laying the foundation for further aggression in eastern Ukraine near areas controlled by Russian-backed separatists. But Ukraine's foreign minister says Kyiv is ready for whatever path Russia chooses.

(BEGIN VIDEO CLIP)

DMYTRO KULEBA, UKRAINIAN MINISTER OF FOREIGN AFFAIRS: We have two plans. Plan a is to utilize every tool of diplomacy to deter Russia and prevent further escalation. And if that fails plan b is to fight for every inch of our land and every city, and every village.

(END VIDEO CLIP)

HOLMES (on camera): But diplomacy dealt another blow on Tuesday as U.S. Secretary of State Antony Blinken called off a meeting with his Russian counterpart. U.S. President Joe Biden says, Russia's actions amount to the beginning of an invasion.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES OF AMERICA: Who in the lord's name is Putin think gives him the right to declare new so- called countries on territories that belong to his neighbors. This is a flagrant violation of international law, and demands a firm response from international community.

(END VIDEO CLIP)

HOLMES (on camera): Our Scott McLean is standing by in Paris for us, but first let's go to White House reporter Jasmine Wright. She is in Washington, and let's start with you, Jasmine. Tell us more details about these sanctions levied, and also, what is still in reserve to come.

JASMINE WRIGHT, WHITE HOUSE REPORTER: Yes, Michael, these are the first steps from President Biden in terms of sanctions, both trying to punish Russia for its current actions, but also trying to deter Russia from continuing any more aggressive action.

So, what President Biden called yesterday at the White House a first tranche. Let me kind of describe some these sanctions and who they'll affect. He outlines sanctions on two large state-owned Russian financial situations. Comprehensive sanctions on Russia's sovereign debt, so you can see on the screen those two banks, as well as sanctions on five Russian elites and their family members.

Now the point is he said, is to cut off the Russia's government from western financing. Now this comes after months and months that me and my colleagues have heard from White House officials and administration officials at large of really devastating consequences, economic cost that Russia would face should it do exactly what the White House officials say is happening right now which is beginning an invasion into Ukraine.

But to be clear here, the president said that this is not all that the White House has in its role attacks really. He says that they are reserving some of their harsher, stronger economic sanctions for Russia trying to deter from further going this really aggressive route. And would put those in place should Russia continue.

[03:04:57] Now on top of those sanctions, Michael, the president also said that he is ordering more troops and military equipment to those Baltic allied countries like Lithuania and others in that area as a defensive mode as a defensive step. Really trying to shore up the U.S.'s commitment to NATO and those NATO allied countries.

And now the president, though, throughout all of these steps, he has continued to say that he is still seeking really a diplomatic outcome, hopefully trying to find diplomatic outcome to the situation ongoing in Ukraine.

But it kind of is hard to see what diplomacy looks like at this current moment as the president continues to condemn Putin for those actions he took in declaring those two pro-Kremlin territories as independent. And so, it also as well as when Secretary Blinken just a few hours ago said that he cancelled the meeting between his Russian counterpart, Lavrov, as they were supposed to kind of hammer out some of the details when it comes to a potential summit with President Putin and President Biden.

Now that is also off the table because it was conditioned upon the fact that Russia should not invade Ukraine. But as we heard new language from the White House in the past few days, they are now saying that Russia is beginning that invasion into Ukraine setting things up for more heightened tension. Michael?

HOLMES: All right. Jasmine, thanks for your reporting. Scott, let's go to you now. Europe was pretty quick able to turn around this package of sanctions. I guess the question is, whether they are going to have any meaningful effect?

SCOTT MCLEAN, CNN INTERNATIONAL CORRESPONDENT: Yes. I mean, we'll see what the actions are on the ground. First, let me describe this package of sanctions, Michael. And what I'm about to say is going to sound strikingly similar to what Jasmine just describe, because Europe has been coordinating its sanctions package with the Americans to try to make sure everybody is on the same page.

And there is no sort of escape effect no way for Russia to get around this package of sanctions. So, it applies to 27 people and entities. We're talking about banks, military personnel, politicians as well as 351 members of the lower house of the Russian parliament as well.

As Jasmine outlined that the U.S. is doing, Europe is also barring Russia from financing its debt from European sources. Now this is not the full package of sanctions that Europe could have applied the package that they had prepared in the event of a full-scale Russian invasion. But it's what they were able to do quickly and with relatively little pain.

French politicians, for instance say that the effect on the French economy will be fairly limited considering that less than 2 percent of French exports actually got to Russia, for instance. And so, the effect might be limited to a few French energy companies.

They're also keeping their powder dry in the event that Russia goes further and they have more tools at their disposal. But the real difficulty for the European Union is that they had to get 27 member countries to actually unanimously agree on this package of sanctions.

And on one hand, you have countries like Hungary, which is quite sympathetic to Russia, on the other hand, you have Baltic states which would very much like to throw the book at Russia. The Lithuanian foreign minister said yesterday that he is not convinced that the package of sanctions that has been approved by Europe is going to do much to deter Vladimir Putin. And he says that they need to be re- visited every day based on the situation on the ground or else. Listen.

(BEGIN VIDEO CLIP)

GABRIELIUS LANDSBERGIS, LITHUANIAN FOREIGN MINISTER: If we close down, and we say that this is the package, we adopted this sanction package and this is it, then this is just a very small slap on the wrist that would actually be an invitation to go in even further. So, our message has to be very clear, we would follow up every day.

(END VIDEO CLIP)

MCLEAN (on camera): Now the biggest move might have been the one that wasn't actually from the European Union, but by Germany and the Nord Stream 2 pipeline and the decision to pause that. And look, Europe has been quite skittish about going after Russian -- Russia's energy.

But just this morning, the France European affairs minister pointed out that, look, Europe has some leverage, a lot of leverage in this equation as well while Europe is undoubtedly very reliant on Russian gas. he points out that 85 percent of Russian gas goes to Europe. And so, his point is that Russia needs Europe a lot more than Europe needs Russia, Michael?

HOLMES: All right. Great reporting there. Scott McLain, Jasmine Wright, thanks to you both.

Let's bring in now Russian journalist and news host Ekaterina Kotrikadze, she joins me now live from Moscow. And it's great to get the perspective from there. What do you think Vladimir Putin's next move will be? Do you have any confidence his troops the so-called peacekeepers will stop in Donbas? I mean, he's called Kyiv the capital of ancient Russia. Do you believe he's headed there?

[03:10:05]

EKATERINA KOTRIKADZE, RUSSIAN JOURNALIST: Yes. Hi, Michael. And thank you for inviting me. There is no clear understanding of Putin's move on this stage, because the problem is that he is unpredictable. And that's absolutely clear for everyone. That he may do whatever he likes to do.

And there is some concern, I would say, that a lot of people are in panic because Vladimir Putin statement that you have just mentioned, that you know, Kyiv is a capital city of ancient Russia, that Ukraine is not a state in his mind. Ukraine should not be a state, Ukraine should be a part of Russia in his opinion. He's not articulating it directly that Ukraine should be part of Russia, but he thinks so, and this is apparent for everyone who follows Vladimir Putin statements. And he's, you know, he's moved.

So, as we understand here, this is just the beginning. After he sends the troops to the separatist republics, he has mentioned after that. It is really important that he has mentioned that he doesn't think that this republic is just, you know, will be under Russian control, and that this republic will be declared independent in their -- in their borders that they control right now.

He meant that the borders are actually wider. The borders of this region. So we have a -- we have a feeling, and we can predict right now that there should be, and can be a lot of -- a lot of circumstances and consequences, difficult consequences for the people who live there.

And there may be some moves, we can see that Russian military buildup is still going on, it has not stopped after Vladimir Putin recognized these republics. That we can say now that they may be, there may be the movement of Russian military forces out of the borders of the region. And even worse, that they can really go to Kyiv. This is not clear, but it may happen.

HOLMES: Right. Yes, and you mention an interesting point about the separatist regions. The separatists are inside an area that is much smaller than the area they claim. And that is the area that Putin has recognized, so will they try to get that other land back as well?

I wonder why you see this, because we talked about this last time, and it's important because you work for one of the few independent media outlets still surviving in Russia. Inside the country, what are people being told? What are ordinary Russians hearing from state media about what is happening versus, you know, what they might hear on your channel?

KOTRIKADZE: Yes, it is very important question actually, because before this all happened, the Russian public was forced to believe that there is an attack from the Ukraine side on the people who live in Donbas, Russian people.

So, Vladimir Putin and his official representatives, official representatives of Moscow, they claim that Ukraine and Kyiv are actually Russia phobic. This is their favorite word, you know, they use it every single time because there is no other way to explain why on earth Ukraine, Kyiv, Volodymyr Zelenskyy would start the war in Donbas.

They explain it's with Russophobia, that they hate Russians, that they hate Russian people who live in Donbas. I would mention that there are about 700,000 people who are already Russian citizens inside of the region. They've got Russian passports, you know, and they've got this passport during last period of time, during this last one here.

So, Russia is explaining to people inside of the country to the Russian public that it is actually defending its citizens inside of Donbas. That Ukraine, Kyiv, is trying to kill them, and you can see that there was some escalation in the region. There were, you know, clashes, a (Inaudible) is working, the explosions and so on.

So, on the state media, on state television channels, you could see that the propaganda machine was working, explaining that Kyiv is killing people, that Kyiv is trying to get back --

HOLMES: Right.

KOTRIKADZE: -- Donbas its territory and integrity of its force.

HOLMES: Yes, yes. Yes, and it's easy to say that you've got Russian citizens inside the Donbas when you hand out, you know, 600,000 passports. It's striking, I wonder I see this too in the optics. It was striking in the video of Putin's security council meeting just how subservient everyone was. They look meek, they weren't confident. They certainly didn't challenge the leader.

[03:14:57]

I'm curious. Is there anyone in Moscow in the Kremlin who speaks truth to Putin, who would dare say, no Mr. President, this is a bad idea?

KOTRIKADZE: Even if there was such a man or woman, we would not know that. And I think that there is no such person. Because you know, Vladimir Putin has been in power for 20 years. You know, this is enough time to get rid of anyone who is against the main course of Vladimir Putin.

So, I don't -- I don't have a feeling that there is anyone who tries to argue with him, and it is absolutely obvious. Did you see how he was speaking to the head of intelligence agency? The main intelligence agency of Russia, Sergey Naryshkin? This person was absolutely, you know, he was shy, he was burning to death because he made mistakes during his statements.

And he was saying that Russia would annex actually Donetsk and Luhansk, the separatist republic. And it was -- Putin was talking to him like a schoolboy. And it all means that he, Putin, --

HOLMES: Yes.

KOTRIKADZE: -- is trying to explain to these old people who are in power in Russia, on any level, that they are also responsible for the things he is doing. That they are also responsible --

HOLMES: Yes.

KOTRIKADZE: -- and they should feel it for this international law violence -- violations.

HOLMES: Yes.

KOTRIKADZE: You know, it is -- it is terrible to watch this.

HOLMES: Yes. They all look cowed to say the least. But as you say, it was important, I think for Putin to make sure that every one of them said they were on board. So, he is spreading the responsibility. We have to leave it there, Ekaterina Kotrikadze, thank you so much. Always good to talk to you.

KOTRIKADZE: Thank you. Thank you.

HOLMES: All right, we have heard a lot from world leaders about the crisis in Ukraine. But what do the people in Ukraine and Russia have to say? Well, CNN has just released the results of an exclusive poll carried out in both countries from February 7 to 15.

First, the polls ask Russians and Ukrainians if it would be right or wrong for Russia to use military force to accomplish various goals. To prevent Ukraine from joining NATO 50 percent of Russians says it would be right to use military force, 25 percent wrong.

Meanwhile, 70 percent of Ukrainians, not surprisingly said it was wrong, just 13 percent said it would be right. How about using force to reunite Russia and Ukraine? A plurality in both countries said it would be wrong. Seventy-three percent of Ukrainians think so, 43 percent of Russians.

But more than a third of Russians did say it would be right to do that. Both Russians and Ukrainians think their country should be separate nations. Just one in 10 Ukrainian saying the two countries should be one. But a third of Russian say so. Nearly two-thirds of Russians believe that Russians and Ukrainians are one people. While two-thirds of Ukrainians believe the opposite, that they are not one people.

You can see a lot more of this exclusive and important polling at cnn.com. And we will have much more on Ukraine at the bottom of the hour. First, let's go back to Rosemary Church in Atlanta with the day's other stories. Rosemary?

CHURCH: All right. Thank you so much, Michael. Talk to you soon.

Well, still to come, the west is hitting Russia with sanctions in an effort to stop its march into Ukraine. A look at what's being done to deter Vladimir Putin, that's next.

Plus, we'll discuss sanctions on Russia are impacting markets in the U.S. and around the world. That's next. Stay with us.

[03:20:00]

(COMMERCIAL BREAK)

CHURCH (on camera): Welcome back, everyone. Well, Germany's decision to put Nord Stream 2 on halt has not only drawn praise from Ukraine, Washington, and NATO, but also brought a sigh of relief. For weeks, the German chancellor appeared to hedged when it came to using the pipeline as leverage against Russia. But this announcement doesn't mean the project will be scrapped, of course.

CNN's Nina dos Santos has the details. (BEGIN VIDEO CLIP)

NINA DOS SANTOS, CNN CORRESPONDENT (voice over): Nord Stream 2 is vast, stretching about 750 miles under the Baltic Sea, it's the longest underwater gas pipeline in the world. Together with Nord Stream 1 the root promises to bring 110 billion cubic of meters of gas a year from Russia to its biggest customer, Europe via Germany.

The vital supply line for one side and a vital source of income for the other. It could worth $15 billion a year for the state-owned Russian energy giant Gazprom. But Nord Stream 2 also came with a hefty geopolitical cost by bypassing existing gas roots to Ukraine, it heightened Russian leverage in the region.

OLAF SCHOLZ, GERMAN VICE CHANCELLOR & FINANCE MINISTER (through translator): No identification of the pipeline can now take place. And without the certification, Nord Stream 2 cannot go into operation.

DOS SANTOS: Following Vladimir Putin's order to send troops into separatist held parts of eastern Ukraine, the German chancellor, Olaf Scholz said that the risk of Nord Stream 2 is too great. Much to the relief of several E.U. members, the United States, and other countries who have oppose the pipeline since its inception in 2017.

URSULA VON DER LEYEN, PRESIDENT, EUROPEAN COMMISSION: Nord Stream 2 has to be assessed in light of the security of energy supply for the whole European Union. Because this crisis shows that Europe is still too dependent on Russian gas.

DOS SANTOS: Halting the project is one of the toughest moves that Germany could make but the decision to block it came at the 11th hour. Ukraine's former acting energy minister and CEO of its state-owned Naftogaz company told CNN that the move will limit Russia's ability to abuse the European gas market.

YURIY VITRENKO, CEO, NAFTOGAZ: There is no connection between Nord Stream 2 and gas supplies at the moment to Europe because Nord Stream 2 is not operating.

DOS SANTOS: Russia seems to be saying that Europe needs to get ready to endure very high gas prices now as a result.

Do you think that that will be the case?

VITRENKO: I don't think that Gazprom and Russia in general at this point can decrease flows of gas to Europe. So that's a bluff. And somebody call -- needs to call this bluff. And that's exactly what Germany is doing at the moment.

DOS SANTOS: The E.U. relies on Russia for over 40 percent of its gas imports. Now such is a tough habit to kick. Scholz's predecessor Angela Merkel championed the project, arguing that it was a necessary step away from other forms of energy like coal, especially after she turned her back on nuclear power a decade ago.

Putin on Tuesday pledge not to interrupt Russia's gas exports, not to turn the tops as the E.U. turns up the diplomatic heat.

Nina dos Santos, CNN, London.

(END VIDEO CLIP)

CHURCH (on camera): The U.S. has also announced sanctions on two Russians banks including Russia's military bank, along with sanctions against Russian elite and their family members. And Russia's ambassador to the U.S. is warning this will hurt global, financial, and energy markets. And even ordinary Americans will feel the consequences.

But although the U.S. President Joe Biden is pledging, he'll do everything in his power to prevent that, he is also acknowledging that Americans will likely see rising prices at the gas pumps in the coming months.

(BEGIN VIDEO CLIP)

BIDEN: As I said last week, defending freedom will have cost. For us as well. And here at home. We need to be honest about that. But as we will do -- but as we do this, I'm going to take robust action to make sure the pain of our sanctions is targeted to Russian economy not ours. I want to limit the pain to the American people who are filling at the gas pump. This is critical to me.

(END VIDEO CLIP)

[03:25:03]

CHURCH (on camera): So, let's see how markets around the world are doing after the tumultuous day yesterday following the escalating Russia/ Ukraine sanctions, and the European markets have just opened higher after we saw a positive day on Asian markets. So, a little encouraging news there.

And U.S. future seem to be doing better as well after global stock markets tumbled and crude oil prices surged to $99 per barrel on Tuesday.

So, let's take a closer look at all of this with Ryan Patel. Senior fellow at Drucker School of Management at Claremont Graduate University. Thanks so much for joining us.

RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT, CLAREMONT GRADUATE UNIVERSITY: Good to be on with you, Rosemary.

CHURCH: So, as we just heard Russia responded to these new U.S. sanctions saying they will hurt global, financial, and energy markets, as well as Americans. And we've already seen oil and gas surge while global financial markets plummeted. A trend already in play of course before this new invasion, but what more can we expect in terms of economic pain across the globe on the back of these first wave of sanctions?

PATEL: Well, the first wave of sanctions is still, I mean, very mild still. Right? We are still seeing, you know, Joe Biden, President Biden and the U.S. administration is saying, if you go and further invade, we're going to put more economic sanctions. I think the clearer we see the oil prices is going to 95, to 100 bucks, to 120.

That, when it gets to 120 oil -- you know, per barrel price rise, that is when are going to start seeing consumer to start to feel the pressure. And the clip that you just played when President Biden said, there is going to be some feel for the American consumer in the sanctions and how long it goes. That's when you saw the U.S. really made hedge bets around trying to get their heads on, you know, more oil with the Saudis and other countries to be able to keep the prices to a reasonable matter while the sanctions go on for who knows how long?

CHURCH: Yes, and of course we don't know if these new sanctions will have any impact on what Putin's next move might be. But what impact could this first round of sanctions have on Russia's economy? Particularly in conjunction with Germany's decision to suspend the Nord Stream 2 pipeline from Russia, and of course, the U.K. and E.U. sanctions?

PATEL: Yes. We saw the Moscow MOEX stock drop 1.5 percent yesterday. It's around 20 percent year to date. Obviously, the oil -- oil companies of the Russian aspect haven't dropping from the stock perspective. You know, it's funny that Nord Stream 2, the price, there was conversation around that it was going to affect the E.U. prices and German prices and energy. And maybe down the road.

But you know, it didn't really dramatically change the price outlook for Germany because the pipeline had not been really expected to come online until second part of the year. So, it's interesting to see how that's more a leverage play behind that.

And again, and it's really to, you know, the fact of inflation, you know, does that going to come and have an impact with Russia? And obviously, the ability to sanction back. Right? When the sanction are coming from these other partner, you know, other global lead -- global countries, will Russia hit back with certain amount of sanctions that puts their economic GDP potentially at a minimum 1 percent decrease right now with the first wave of sanctions.

CHURCH: Yes. That's a big question of course. And Ryan, Putin has built up vast financial reserves of his own, of course, sheltered overseas and inside Russia. So, he is not going to feel any economic pain himself. But the oligarchs will along with the Russian people, particularly once the west applies the full extent of what they're calling severe economic sanctions. So, what impact will all those combined sanctions likely have on Russia's economy in the end going forward?

PATEL: Yes. You hit it right on top of the button there. It's the financial institutions, the banks. Right? E.U. with swift being able to make it harder for, you know, Russia to be able to get money out of the country. And that affects, you know, their people, obviously the rich -- you know, the rich investors that are going into places like the U.K. and the U.S. And you know, the E.U. has done it to Iran many years ago to that's not a bluff. And obviously, what we saw with President Biden with putting more sanctions on the financial institution. So that to me, is a full force. If they put full force on the financial institutions, it affects the money flow going in and out of the country. We've seen it in other countries like in Venezuela, in Latin America, and certain places where you can't convert the currency to another currency. And that, at the end of the day it limits the power and hurts the GDP of Russia.

CHURCH: Yes. And there's a lot of pressure for the United States United States to go ahead and do that and use the full force of those sanctions.

[03:30:00]

But Ryan, I also want to ask you, U.S. officials have told businesses to watch out for ransomware attacks after President Biden announced those new sanctions against Russia. So, what are the potential economic consequences of cyberattacks especially of businesses haven't already moved adequately protect themselves from such attacks?

PATEL: I'm smiling because you and I both know that the U.S. businesses haven't moved fast enough. Right, it's like 60 percent to 70 percent of cyberattacks hit on small businesses are not even prepared and in the new, you know, when the markets, you know, are surprisingly resilient at this point when the word invasion means you typically think of what? The military across the borders.

Well, that's not the only way we live in a different world now on cyber security on specific companies, specific industries, supply chains, right? Just don't think about one specific company. It could be certain supply chains that could cause a ripple effect.

And that is a really, really impactful and really does cause uncertainty and chaos potentially to earnings and lead to a ripple effect. That's why it's really interesting to see how, you know, economists and analyst, and including myself look and break down where the impact is. This is not just in energy, at least to one country, one small disruption, it leads to a bigger disruption at a different industry and does have an overall impact.

CHURCH: Yeah. It is a wakeup call for all those businesses to move right now. Ryan Patel, many thanks, as always, I appreciate it.

And still to come here on CNN. Russian forces appear to edge ever closer to Ukrainian territory. We will take you to the Russian areas that border Ukraine's Donbas region.

Plus, reaction to the E.U.'s decision to impose economic sanctions on Russia. Do stay with us with that and more.

(COMMERCIAL BREAK)

CHURCH: Welcome back, everyone. I'm Michael Holmes, coming to you live from Lviv in Ukraine. The Russian president recently released a new message that showed something of a willingness to peak negotiating over Ukraine. But at the same time shows him refusing to budge on core issues.

(BEGIN VIDEO CLIP)

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): Our country is always open for direct and honest dialogue for finding diplomatic solutions to the most difficult problems. But I repeat Russia's interests and the security of our citizens are non-negotiable for us.

(END VIDEO CLIP)

HOLMES: Now we're also tracking Russia's response to newly imposed sanctions. The Russian envoy to the U.S. warning ordinary Americans will also feel the consequences and so too will the global financial and energy markets.

[03:35:05]

And he was quoted on the Russian embassy's Facebook page saying this, quote, "I don't remember a single day when our country lived without restrictions from the Western world. We learned how to work in such conditions and not only survive but also develop our state."

But when it comes to the sanctions imposed by Britain, Russia is taking a sharper tone calling them illegal in terms of international law. The Russian embassy in London, issuing a statement accusing the British government and the media too of ignoring the plight of people in the breakaway regions of Eastern Ukraine.

Now the sanctions are meant to punish Moscow for what the U.S. calls the beginning of the Russian invasion, of course. The top American diplomat says, the Russian president's intentions have been clear the whole time.

(BEGIN VIDEO CLIP)

ANTONY BLINKEN, UNITED STATES SECRETARY OF STATE: It's been all along is to invade Ukraine. To control Ukraine and its people. To destroy Ukraine's democracy which offers a stark contrast to the autocracy that he leads. To reclaim Ukraine as a part of Russia. That's why this is the greatest threat to security in Europe since World War II.

DMYTRO KULEBA, UKRAINIAN FOREIGN MINISTER: The entire world stands today with Ukraine and rightly so. Putin wants much more than a war torn piece of Ukrainian land and people living there. What stops him is only our unity and resolve.

(END VIDEO CLIP)

HOLMES: Now Russia seems determined to keep the world in suspense on the timing of this military deployment to Eastern Ukraine. And yes, some leaders say Russian troops have already arrived but more and more are expected and President Vladimir Putin is refusing to put a date on when they will actually cross the border.

(BEGIN VIDEO CLIP)

PUTIN (through translator): Firstly, I didn't say that the troops would go there right after our meeting here. That's the first thing. Secondly, it's impossible to predict any specific outline of possible actions in any way. Everything depends on the specific situation that is developing on the spot on the ground.

(END VIDEO CLIP)

HOLMES: CNN Russian affairs contributor, Jill Dougherty now with some perspective from Moscow.

(BEGIN VIDEOTAPE)

JILL DOUGHERTY, CNN CORRESPONDENT (voice over): There's a sense of inevitability here in Moscow of a plan unfolding. First, there was President Putin recognizing those two breakaway regions in Donbas. Then a series of televised votes in the Parliament giving President Putin the greenlight to deploy Russian troops outside of the borders of Russia in connection with the events in Donbas.

Then President Putin at a news conference telling Ukraine, it should simply give up any ambition to join NATO. With the United States and Europe leveling more and more serious sanctions against Russia. A former Russian president fires back saying welcome to the brave new world where Europeans will have to pay more for gas.

So did the United States underestimate Vladimir Putin? The U.S. Secretary of State was asked that very question and he said no. That the U.S. has laid out, he said, Putin's entire playbook. The playbook that he is now following.

Jill Dougherty, Moscow.

(END VIDEOTAPE)

HOLMES: CNN's Fred Pleitgen is in Southern Russia monitoring the country's military movement near the border. He's also meeting some Donbas evacuees in Russia who say they're grateful, President Vladimir Putin is intervening there. Here's more from Fred in the Russian city of Rostov-on-Don.

(BEGIN VIDEOTAPE)

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): Russian forces near Rostov advancing towards Ukraine's border. Moving columns of artillery pieces and tanks towards the separatist controlled areas called, the Donbas, recently recognized by Vladimir Putin. The Russian leader coy when asked if his forces had already cross the border and just how far they might advance.

Firstly I didn't say that the troops would go there right after our meeting with you here, that's the first thing he says. Secondly, it's impossible to predict any specific outline of possible actions at all. It depends on the specific situation that is developing on the spot. We travel to the Russian region bordering Donbas and saw soldiers all

around including long columns of troop carriers and heavy armor standing ready.

The area close to the border with Ukraine on the Russian side is teaming with military equipment. We've seen armor, we've also seen self-propelled artillery as well. The U.S. says it believes that this could be a sign that a larger offensive could be looming even as Moscow says it has no such plans.

[03:40:02]

Russia has greenlighted troop deployments to the separatist areas, a clear breach of international law, NATO says.

JENS STOLTENBERG, SECRETARY GENERAL OF NATO: Moscow has now moved from covert attempts to destabilize Ukraine to overturn military action. This is a serious escalation by Russia.

PLEITGEN: Russian authorities say tens of thousands of Donbas residents have been evacuated to this area in Russia. Some we talked to praised Vladimir Putin for intervening in Ukraine.

Putin we are very grateful that this happens, if he helps us now, we will live normally and free, this woman says.

And she says, of course, we are happy. The entire camp didn't sleep all night. We watch it live, everyone was happy and we even had a celebratory tea party in one of the camp buildings.

But the enthusiasm could be short-lived as the U.S. says Putin's moves to infringe on Ukrainian territory could be the prelude to a bloody devastating war.

Fred Pleitgen, CNN, Rostov-on-Don, Russia.

(END VIDEOTAPE)

HOLMES: Well, while the world waits for Vladimir Putin's next move, the president of the European commission says, she welcomes the E.U.'s decision to impose a first round of economic sanctions against Russia over the Ukraine crisis. Ursula von der Leyen also condemning Mr. Putin's formal recognition of those two separatist regions in Ukraine and the movement of Russian troops. Here's more from the E.U. leader.

(BEGIN VIDEO CLIP)

URSULA VON DER LEYEN, EUROPEAN COMMISION PRESIDENT: This decision violates the territorial integrity and the sovereignty of Ukraine. Russia is not respecting its international obligations. And that is violating core principles of international law. Our action today is a response to Russia's aggressive behavior. If Russia continues to escalate this crisis that it has created, we are ready to take further action in responds. The European Union is united and acting fast.

(END VIDEO CLIP) HOLMES: But she's also welcoming Germany's decision on Tuesday to

halt certification of the Nordstrom 2 pipeline. That natural gas pipeline would link Germany to Russia without having to cross Ukraine. It's one of the strongest financial moves yet to punish Russia for its aggression even though gas is not yet flowing, so nobody is losing money at the moment. We're going to have much more from Ukraine coming up. First, let's take it back to Rosemary Church in Atlanta. Rosemary?

CHURCH: Alright, thanks so much Michael. I appreciate it.

Well, still to come here on CNN. Hong Kong plans to put every single resident through multiple stages of COVID testing. We are live in Hong Kong with the latest on the fight to slow the spread of the virus there.

(COMMERCIAL BREAK)

[03:45:00]

CHURCH: Global cases of COVID-19 are falling around the world, according to the World Health Organization. But it says a drastic drop in testing could be part of the reason why. And you can see here on the map, many countries shown in light green reported between a 10 percent and 50 percent drop in new cases over the past week. The WHO's Technical Lead For COVID Response over this warning on the falling trend.

(BEGIN VIDEO CLIP)

MARIA VAN KERHOVE, WHO'S TECHNICAL LEAD FOR COVID-19: Now I want to put some caution around this, because the amount of testing that is occurring in countries is reducing substantially. So this declining trend that we are seeing in about a 20 percent reduction in cases, may not be real.

(END VIDEO CLIP)

CHURCH: Well, Hong Kong Chief Executive, Carrie Lam, is ordering mandatory COVID tests for all residents beginning in March. The precaution comes amid surging new infections that officials say have exceeded the government's ability to handle. Carrie Lam says it's just one of many steps to fight the virus.

(BEGIN VIDEO CLIP)

CARRIE LAM, HONG KONG CHIEF EXECUTIVE (through translator): Our strategy is to step up efforts in all respects. First is to enhance the capability to detect infection as early as possible. With our earlier efforts in Hong Kong and the central government's help in place, we will carry out compulsory COVID-19 testing for all residents.

(END VIDEO CLIP)

CHURCH: And CNN's Ivan Watson joins me now live from Hong Kong with more. So, Ivan, what has been the reaction to Hong Kong's decision to impose these mandatory COVID tests starting next month along with other tough new measures, of course?

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (on camera): Well, anecdotally, I have seen message boards, Facebook groups, WhatsApp groups where people are worried and actually frightened. And talking about trying to get out of this international financial hub, before this next measure is implemented.

And I think part of that has to do with the strange journey that Hong Kong has been on, as well as China, compared with the rest of the world. Both China, and Hong Kong, remain firmly committed and are doubling -- tripling down on what they call their dynamic zero COVID policy. They want no COVID at all.

It is a little hard to do when Hong Kong has just hit a new record of 8,674 more confirmed cases here in Hong Kong. Now the policy today has been that if you test positive, you go into hospital isolation. That worked well for two years as well as contract tracing and very strict quarantine. Basically cutting Hong Kong off from the rest of the world.

But now that there is such widespread contamination and contagion inside Hong Kong, it is not working anymore. Last week we saw some hospitals overflowing with patients outside the emergency rooms. Outside isolation wards. Now the Hong Kong government is declaring that it is fast forwarding a process to try to build tens of thousands of new isolation units, hospital camps, medical camps you could call them.

So, as part of the next step of trying to fight this new wave of infections, the government has announced, the entire population, more than 7 million people will have to undergo three rounds of mandatory testing starting in March.

If you test positive, you will theoretically have to go into these newly constructed medical camps. The Hong Kong University has projected that in two, three weeks, this city will be at 180,000 infections a day. Which will far exceed the number of new medical camp units that will be built.

Despite this, the Hong Kong government is extending its ban on flights from nine different countries. Let me check, the latest number for imported cases, three. Were flown in to this city while the city in the last 24 hours had 8,600 new local cases.

Back to you, Rosemary.

CHURCH: I can't believe the numbers there. Ivan Watson, many thanks for that live report from Hong Kong.

Well, the fourth named storm in as many weeks is slamming into Madagascar right now. Tropical Cyclone Emnati made landfall overnight, local time, bringing heavy rain, strong wind, and rough seas. Many of the people in the storm's path were already displaced and reeling from a deadly cyclone just a few weeks ago.

So let's turn to our meteorologist, Pedram Javaheri, who joins us now live. Good to see you, Pedram. So, how unusual is this? And what is the latest on this fourth storm in a month to hit Madagascar?

PEDRAM JAVAHERI, CNN METEOROLOGIST (on camera): You know, it's remarkable, we certainly have not seen anything like this in quite some time when it comes to the frequency, the consistency of these storms coming in one after another as you noted, one in every single week in the past four weeks now.

[03:50:06]

This particular one, equivalent to a category one hurricane winds and landfall came to short around midnight there on the 23rd, but 140 kilometers per hour. And coming in very close to the previous storm, (inaudible) made landfall here about a week and half or so ago.

But you take a look at the perspective here, the system is going to begin rain itself out this landscape and eventually move further south and over open waters. But an incredible storm system given what has happened here in recent days.

In fact, climatologically speaking, only one tropical cyclone of that category one equivalent occurs on average every single year. Now, can go on for the record, for the most in one year, that's five from 1975. And you'll notice certainly with about a couple of months left here in the tropical season. You could see another system move ashore across this landscape. But here's the record news from 1975.

And the concern now is the additional rounds of rainfall. You could see as many as 250 to 300 millimeters across the southern region. And the area frankly beyond just the last couple of weeks of tropical systems had been very, very dry across this landscape.

Droughts sure came in for the past decade or so, and a lot of this rainfall is beneficial, unfortunately, Rosemary, too much of it is coming down in a short time period and that is leading to the problems we've seen across these areas as well.

CHURCH: Alright. We thank you for that explanation. Pedram Javaheri, I appreciate it.

Well, time for a short break now. When we come back, Russian troops moved closer to the border with Ukraine. The U.S. president calls it an invasion, but holds back on the most punishing sanctions. Back with that in just a moment.

(COMMERCIAL BREAK)

HOLMES: Hello, everyone. I'm Michael Holmes in Lviv, Ukraine. Australia and Japan are joining a growing list of countries imposing sanctions on Russia. President Vladimir Putin of course, recognizing the independence of those two self-declared republics in Eastern Ukraine. And authorizing Russian troops to enter the region.

Now have a look here, new satellite pictures showing Russian forces and military equipment in Belarus, and parts of Russia, moving closer to the border with Ukraine. They include vehicle convoys, military tents, and even a field hospital. The U.S. Secretary of State, Antony Blinken, meanwhile has canceled

the meeting with his Russian counterpart, Sergei Lavrov, which has been scheduled for Thursday.

Now, the U.N. Secretary General says Russia's latest moves are the deathblow to the Minsk Agreement. That deal between Russia and Ukraine, back in 2014, had been the framework for peace in Eastern Ukraine.

Antonio Guterres, also took issue with Russian President Vladimir Putin's use of the term, peacekeepers, to described Russian troops in Ukraine. Have a listen.

(BEGIN VIDEO CLIP)

ANTONIO GUTERRES, U.N. SECRETARY GENERAL: I am also concerned about the provision of the concept of peacekeeping. I am proud that the achievements of U.N.'s peacekeeping corporations in which so many blue elements have sacrificed their lives to protect civilians. When troops of one country, enter the territory of another country without its consent, they are not impartial peacekeepers, they are not peacekeepers at all.

(END VIDEO CLIP)

HOLMES: More now from CNN's Alex Marquardt.

[03:55:00]

(BEGIN VIDEOTAPE)

ALEXANDER MARQUARDT, CNN SENIOR NATIONAL CORRESPONDENT: The Kremlin is calling them peacekeepers. But that is not convincing anyone that the Russian troops being ordered into the breakaway regions of Eastern Ukraine, couldn't soon do more.

Putin today didn't say when the troops would be deployed. But the head of NATO said, a further invasion is underway.

STOLTENBERG: Russia has been present in different covert operations on Donetsk and Luhansk for many, many years. What we see now is additional Russian forces enters, moving in. And this makes the whole situation even more serious.

MARQUARDT: The Kremlin's recognition of the territories adds up to what could be, with Crimea, essentially a land grab of 7 percent of Ukrainian territory. If you think his campaign stop here, more than 150,000 Russian troops and a modern arsenal of weaponry still surround Ukraine on three sides. To the north in Belarus, the Russian presence is apparently open ended.

There are fears also for Ukraine's southern coast on the sea of (inaudible), thought to be a potential target for Putin to further connect illegally seize Crimea to Russia.

MIKE ROGERS, CNN NATIONAL SECURITY COMMENTATOR: They want to cutoff more of the (Inaudible) seas strategically that's important for Russia, as well as this romantic notion of Putin's that Ukraine is really a Russian state, and that it should have been all along.

MARQUARDT: And in Eastern Ukraine, that front line in the past eight years has now suddenly changed. Posing new dangers (inaudible) unmarked, unrecognized frontier, the prospect of Ukrainian troops a few hundred meters from Russian troops.

The rebel enclaves that Moscow recognized are just one third of the provinces that they are in. But Putin today said, they believe the so- called republics can claim the rest of the land. An issue he said that will be worked out in talks between Kyiv and the Kremlin backed separatist.

JULIA IOFFE, STAFF WRITER, THE ATLANTIC: Just last week they said they were withdrawing troops, it turns out they weren't. They said they wouldn't. Putin last week said he wouldn't recognize this breakaway republics because it would violate the Minsk accords. He recognized the breakaway republics.

MARQUARDT: Some observers believe the Kremlin may even have much of Eastern Ukraine in its sights, coming all the way here to the Dnieper River which divides West and East Ukraine. It's one of the few natural barriers in what is a largely flat country.

Some officials and experts fear that Putin's next move could be fast and heavy. Others believe that it will be incremental and gradual. Either way, designed to weaken the Kyiv government and expand Russia's reach.

Alex Marquardt, CNN, Zaporizhzhia, Ukraine.

(END VIDEOTAPE)

HOLMES: Back with more news after the break.

(COMMERCIAL BREAK)

[04:00:00]