Thank you very much, Mr. Dewar, and it was a pleasure to have you at the Munk School. It's always a pleasure to welcome members of Parliament.
I think we have quite a broad tool kit which we want to use in a calibrated way to send a very strong message to Russia that this country opposes any unilateral change in borders, which is fundamentally what did happen in Crimea. The referendum that occurred did not, in fact, embody a process which any Canadian would really recognize as legitimate, and I think that's a position that crosses all of the different interpretations right now.
What then can we do? Well, we want to preserve the capacity to move forward and increase sanctions should events on the ground in fact worsen from our perspective. So the place where we've started is in fact the correct place to start. That is what we'd call now smart or targeted sanctions. We've learned a lot over the last decade about how we make sanctions smart. The fundamental part of smart sanctions is that they punish individuals who we think are making decisions that are illegitimate from our perspective, but we try to avoid for as long as possible inflicting punishment on the broader population. Why do we do that? There are two reasons. One is we've learned that broad sanctions often punish the most vulnerable in a society and that's not something which I think Canadians would want to do. The second reason is when we do that, that actually strengthens the support of a population behind a beleaguered government.
Very broad sanctions and broad embargoes are not effective tools of foreign policy. We began, as did most of our allies, with a very narrow set of sanctions. Should events for instance in Donetsk deteriorate over the next 24 to 48 hours in ways that would create alarm, there is the capacity, first of all, to lengthen the list of those who are sanctioned. As we move forward, we could include heads of many of the state-owned enterprises on a targeted sanctions list, for example. It's reasonable to expect that these people who do a great deal of business outside of Russia's borders and who are dependent on hard currency to transact their business will become increasingly disconcerted by the foreign policy their government is pursuing.
First of all, we can broaden the list. Second, we can deepen the list. These are all options we have not yet used that are still available to us. There is a whole series of steps we can take down that road.
I think the message we should be sending to the Government of Russia is that we will respond to their behaviour and we have the capacity to do so, obviously not alone, but in concert with our allies, particularly our allies in the United States and in Europe.
Also, should the situation become significantly worse, there are a series of political sanctions as well. Some of these have been talked about. We have not used them. There is of course the membership in the G-7/G8. There are, in fact, diplomatic sanctions that we can impose. Those kinds of sanctions are much further down the road.
We would want to stay diplomatically engaged for as long as we can, because we would want to be sending a message over and over to the Russian government, in as many ways as we can, that the key issue for us is respect for the territorial integrity and sovereignty of Ukraine, and that we've passed the moment in European history where borders are changed unilaterally or through illegitimate processes.