Transcript for Putin Signs Crimea Annexation Into Law
This is a special room. I'm -- company or quit as ABC news digital special report Crimea is now officially part of Russia but the matter is far from finished as the international response is ramping up. To hit Russian president Vladimir Putin where it hurts the Russian economy. ABC's Karen Travers joins us now live with the latest Karen. Good afternoon Dan it's been a back and forth the last couple of days with the sanctions tit for tat that's been going on between the US and Russia. Next week President Obama will travel to Europe and he's meeting with top world leaders there but notably not on the guest list -- -- -- couldn't. This is the meeting of the G-7 it is usually the G-8 -- being left out of this in Ukraine is certainly going to be at the top of the list. -- this agenda that -- there's also some clear signals in the last 24 hours that perhaps tensions are easing. Today Russia made it official. President Vladimir -- -- annexation of Crimea into law. But also said the ongoing sanctions battle between the US and Russia should be put on hold. Yesterday the US -- penalties on Putin's inner circle including his chief of staff. Billionaire friend. An embattled so I did Putin's associates could be called Putin's piggy bank these are all choices -- the Russian government has night. Choices that have been rejected by the international community. As well as the government of Ukraine. Next it was Russia's turn yesterday Putin's slapped his own sanctions a ban on travel to Russia on top US officials including two top White House aides and Republicans John McCain and speaker of the house John Boehner. Gruden said he doesn't see an immediate need for further retaliation. As signal that perhaps tensions may be cooling down. Today and you Ukrainian prime minister signed a political agreement with the European Union and -- the pressure needs to stay on Russia. Russia decided tool. Actually. In polls in new -- Cold War order. And three -- the results of the second world. More Russian stocks were already feeling the heat the market there's -- more than 10% in March. Two top credit rating agencies put Russia on notice that the potential downgrade. And visa and MasterCard stopped serving two Russian banks. President -- downplayed the impact of the sanctions are having on the Russian economy and Danny even said he would open up an account. At one of the targeted banks -- Act of defiance right there ABC's. Karen Travers in Washington -- -- and that can expect that appreciate what every ABC's -- -- art via Skype from some fair -- Crimea. Alex is so President Putin signed this -- not -- -- Russia does life go on as normal there. Well on the surface it would certainly appear to be I just got back from a -- -- Super Bowl -- as the capital. A -- you if you didn't know better you would think that -- there was no crisis that that nothing was happening. But then when you start digging down a little bit you know it's not as simple as running up the Russian flag and saying now -- Russia and you know like this continues as normal there will be some. Changes there already have been some changes. Topping the list for example in a couple weeks Crimea will jump ahead two hours of the Moscow. Time zone and you'll start using the Russian rule in parallel wins you -- there Ukrainian currency. We also expects a long lines received long lines in fact at Russian consulates of a Ukrainian Crimea and trying to get. A Russian passports. -- -- adopt the Russian educational system but they're also lot of questions about documents if you've been this part of the world before you know that they are big fans of red tape and bureaucracy. I'm so people have sent to us we don't know what this is gonna mean in terms of our documentation RIDs. Up property for example who governs those laws are there -- you know you can't just switch from one legal systems the other. Without a few problem so there is some trepidation but overall there's a lot of excitement a lot of happiness by the vast majority of the population. That -- is now part of Russia. We've heard from the new Ukrainian prime minister. Is there -- going to be any move by him by anyone else -- we for vocal event to push back the take back Crimea physically anyway. Now in short no I mean even before the referendum on Sunday we saw crime means vote overwhelmingly to join Russia the acting president -- -- said that. -- Ukrainian military -- knots intervene. Ukraine is is fully cognizant of how strong the Russian military is they want to see this assaulted diplomatically politically. Ukrainians know that -- through the west NATO. The United States Europe are not gonna -- there -- militarily so in in short everyone's it's coming to the realization that Crimea is -- the Crimea is now part of Russia. You brought the fact that the Russian military obviously the strength and its presence is certainly -- -- acknowledged there but what about the Ukrainian troops are still in Crimea. What will happen to them. Well as an estimated 25000. Ukrainian troops still here many of Ukrainian bases have been overrun by the Russians have been seized by Russian forces. A most notably two days ago we saw the naval headquarters in the port city of Sevastopol. Get overrun by these pro Russian forces and then quickly seized. By Russian soldiers there are still a number of bases. That are under Ukrainian control we visited one yesterday we spoke with the commander colonel who -- very somber a very solemn and -- quite depressed it seems. I'm -- what he told us is that. I'd be the defense ministries in -- Evan in Moscow are talking to each other to try to come sort to some sort of peaceful solution. A whereby we will see the Ukrainian base is being handed over to the Russians we've already seen that happen act that headquarters there was. Peaceful handover which Ukrainian flags I came down to the Russian flags. Went up and we -- that that will happen and other Ukrainian bases in the coming days there are still big questions about what happens to the weapons to the ukrainians take their weapons. Window so we could see a scenario in which over the weekend the coming days. In large convoy heads out of Crimea into Ukraine. It might be -- weapons and might be without. Ukrainian government says the working on a plan to resettle those those -- that's when he finds that troops. As well as their families of course -- many Ukrainian troops here Crimea feel loyal to Russia they -- -- I've seen some switch sides already and they're also from Crimea so -- -- -- likely stay here. So from the might of the sword to the might of the almighty economy there earlier this week President Obama announced a round of sanctions meant just yesterday of course additional sanctions. Primarily targeting a lot of high level officials in -- that there. And then Jews today president who making an interest in remark during that signing -- -- it would be and unlikely in fact that Russia would put more sanctions. Towards the United States that of course all in retaliation. From those sanctions -- the US had put on Russia why do you think that he would make that kind of a statement during the signing ceremony. That was a very interesting comment one can interpreted in a couple different ways that he's leaving the door open for more sanctions down the line. I -- he's backing down in the face of these harsh sanctions. From the Europeans and from the Americans but soon after he made that comments his spokesman came out and then seemed to clarify -- not really talking down our read a quote for you this is from -- NASCAR. He says this will not go unnoticed. We will give -- responses every time but we still support developing our cooperation so this could be interpreted as something of a truce but it's clear that it's that is not what this story's not over yet these -- -- -- impact -- the sanctions. Is not a -- So how much credence or would you give the possibility that if in fact it's not the US that might be a target of additional sanctions but it could be Europe. Yeah he didn't mention Europe in that and -- The fact is there's so much business between the United States and Russia -- certainly compared to Europe so it's much easier for for the United States to impose sanctions on Russia it's a lot more complicated. -- their economies are -- closer a lot more intertwined a lot more connected. But at the end of the day Europe does appear to have the upper hand around half. Russia's budget comes from oil and gas sales to Europe. Europe on the other hands imports around 25%. Of its gas from Russia -- -- houses the resources it's a lot more flexible. A when it comes to gas of course now is springtime or -- summer so that's a lot less of -- reliance on. On Russian gas but that's not to say -- a European countries. Themselves won't be affected negatively on an individual basis there's a lot of trade between European countries. And Russia for example Russians. Wealthy Russians by a lot of property. In the UK. And didn't in France the French sell weapon is to. And warships to Russia. The Germans are the biggest trading partner with Russia so you know countries an individual basis ten be harmed but -- wider ranging sanctions that have not been put into place. Now but but Europe does have that upper hand over Russia and can inflict a lot more pain on Russia have been by -- Well speaking of Crimea and the actual logistics of its annexation -- The infrastructure the water electricity. Essentially the rest of its utilities all connected to Ukraine what are the plans that -- it matter re connecting lines to Russia to get the support system going from that direction. -- -- frank answers we simply don't know yet I mean those lines are not in place it's -- -- -- just but the switch and go from Ukraine to Russia. Overnight -- Ukraine has given no indication they plan to shut off. The water power and gas lines Internet alliance coming from Ukraine and we spoke to shopkeepers for example who were saying right now they're not getting any more supplies -- -- in an electronics -- and that the store manager was telling us what we're selling what happily haven't gotten anything more from. -- from our suppliers in Ukraine does that mean that we're gonna start getting from Russia we don't know. Who can. Grocery stores again it all came through Ukraine even if it was Russian community came -- Ukraine where do we get that -- not. So the Russians have talked about building. A system of tunnels and bridges over from the Russian mainland it's -- -- but that's not only extremely expensive is not really an extremely. Big -- projects conflicted project but it also take. Quite a bit of time so for now. We assume a lot of that is still going to be coming through Ukraine but it's one of the many questions that has has yet to be answered can -- just switch everything over to Russia not a -- as part of Russia. You know earlier the president's program -- said that there are no ambitions to go beyond Crimea and sometimes the rhetoric doesn't necessarily match the actions given the fact. That Crimea was taken over relatively easily relatively quickly. What is the think he meant for the next who possibly hitting -- or southern Ukraine. Right that is the fear because that -- justification that the president couldn't get in his speech to parliament the other day -- that historically. Crimea is a part of Russia and the Koreans went out and voted overwhelmingly to draw process and that was the justification for -- Crimea an independent -- -- it. Two to Russia there are Beers certainly. By the Ukrainian. And concerns in the west. That -- eastern time on Ukraine are not over that he could stand in do I he's been southern Ukraine -- -- a lot of unrest in those parts being pro. -- Russian forces coming -- -- -- -- Kingdom you could be Russians are coming and it -- and and with her called her referendum as well the Ukrainian militant -- for their part had been digging trenches along that border. Talk talk -- -- the US spending. I'm the equipment to help you -- military is in eastern Ukraine between Russian troops moving along that border so that we ripping up that. Here but really get the end of the day and there is there isn't not that -- be -- and and in Russian invasion that is unlikely for the time being but this story is far from over we don't know really what Putin's plans are what he had planned for down the line. Alice last week -- going to ask you this question as a journalist covering this and we see these tensions escalating. And of course Koreans are seen that the these sanctions going back and forth between the US and Russia. How have you been received as -- -- on the streets they're talking to people and notice a difference and in the kind of interactions are having. Well got a lot easier. Over the course with hockey -- -- -- were settling into new reality that car in the Russia a lot quieter company earlier alike appeared on this circuit to go on. -- there while the very tense. Time. -- -- before the referendum weren't hardened their way we did see violence against journalists -- harassment there were threats there -- even attacks on journalists. So we'd been -- we have been operating very carefully -- want the security consultants we planet. Our moves very carefully we try not soon I'm going to dangerous areas obviously we try not to go places up. We could draw it can you know people who might want to do us harm. But -- but our interactions. John generally -- there have been some some frosty interactions. With the Russians -- on the ground to you know perceive us as an American network. -- -- as an extension of the American government a lot of -- people want explained -- the points of -- they wanna get across the fact that they feel like they're -- they don't feel like they've been that -- if you like they've been living a -- essentially that they've been forced to live in Ukraine individual -- -- back to -- and that's really -- the message that they've been telling -- and that they would like -- related to humans -- -- ABC's -- Lockhart in Crimea Alex outstanding reporting as always and of course -- -- we appreciate your time. You of course can keep up with the situation in Crimea in real time by downloading ABC news App Store in this story for exclusive updates on the go. For now on death -- for New York with this ABC news special report.
This transcript has been automatically generated and may not be 100% accurate.