BERLIN - Germany's Angela Merkel warned Moscow on Thursday that it risked "massive" political and economic damage if it refused to change course on Ukraine, saying Western leaders were united in their readiness to impose sanctions on Russia if necessary.
The chancellor, using her strongest language since the start of the crisis and removing any suspicion that Germany might seek to avoid a confrontation with President Vladimir Putin, said his actions would lead to "catastrophe" for Ukraine and much more.
"We would not only see it, also as neighbours of Russia, as a threat. And it would not only change the European Union's relationship with Russia," she said in a speech in parliament.
"No, this would also cause massive damage to Russia, economically and politically."
Merkel has acknowledged that her efforts to persuade Putin to negotiate via a "contact group" with the transition government in Kiev - which he accuses of ousting Russian-backed president Viktor Yanukovich unlawfully - have failed and time is running out.
Russian troops have seized control of the Ukrainian region of Crimea on the Black Sea, backing separatists who have taken over the local government and are preparing a referendum on Sunday which could pave the way for annexation by Russia.
Merkel reiterated that if Putin continues to snub diplomacy and lets the referendum in Crimea go ahead, the EU - in close coordination with Washington and NATO - would impose tougher sanctions than the largely symbolic measures taken so far.
Travel bans and asset freezes on people and firms accused by Brussels of helping to violate Ukraine's territorial integrity could be approved by EU foreign ministers on Monday.