MoscowAs expected, and in complete disregard of Russian warnings, the leaders of the G7 countries agreed at their summit held in Italy – yesterday, Thursday – to grant Ukraine a loan of 50 billion euros ($54 billion), deducted from the interest generated by the Russian state’s assets estimated at about 280 billion. Dollars, as the group continues to emphasize tightening Western sanctions imposed on Russia following its war on Ukraine.
This came hours after the United States expanded the sanctions imposed on Russia, as Washington imposed sanctions on 300 individuals and legal entities on charges of supporting the Russian military operation in Ukraine, and included – among other things – the Russian financial infrastructure, mainly represented by the Moscow Stock Exchange, and computing services. Cloud, IT, LNG projects, etc.
Washington says it Russian authorities I managed –Through the Moscow Stock Exchange – by attracting capital from friendly and neutral countries.
The new US sanctions did not stop there, but included 7 foreign companies from Liechtenstein, Cyprus and the UAE, allegedly linked to a scheme to evade the restrictive measures imposed on Russia.
This coincided with Britain’s inclusion of the Moscow Stock Exchange, the National Clearing Center and the National Depository Center for Settlements on the sanctions list, according to the Financial Sanctions Implementation Office, which is the British regulatory body responsible for implementing sanctions.
Moscow responds
In her first reaction to the sanctions, Russian Foreign Ministry spokeswoman Maria Zakharova said that Moscow’s retaliatory response to the use of its frozen assets for the benefit of Ukraine would be very painful for Brussels (the center of the European Union), and that European property and funds in Russia were sufficient for that, adding that “they will first have to… “They pay for their madness from their own wallet.”
Earlier last month, Russian Finance Minister Anton Siluanov warned that “if our property, money and reserves are seized by Western countries and their income is used, we will act in exactly the same way, and we will confiscate all the assets that Western countries have here in Russia.”
In a previous statement last February, Siluanov said that his country froze Western assets worth no less than what the West froze, meaning about $300 billion.
The sanctions imposed on the main institutions in the Russian financial sector are the most serious during the past year and a half after the imposition of the oil embargo and the ceiling on oil and gas prices.
The evening of June 12 was marked by what resembled the detonation of an “economic bomb,” as the Moscow Stock Exchange stopped trading in dollars and euros, and the Central Bank announced that all trading operations in these currencies would now take place in the over-the-counter market, and the ruble exchange rate for them there would be determined, according to Previously approved methodology.
Expected actions
For his part, economist Igor Belsky told Al Jazeera Net that the sanctions against the Moscow Stock Exchange cannot be considered something new or unexpected, as this was one of the expected scenarios in light of the imposition of more than 20,000 sanctions on the country since 2014, from which no sector was excluded. almost.
In his opinion, what happened is influential but does not constitute a disaster, as trading will continue on the Moscow Stock Exchange in other instruments there, especially the Chinese yuan and precious metals, in exchange for the removal of trading in the US dollar and the euro.
He continues that as a result of the news about the new sanctions and restrictions, the Moscow Stock Exchange index began to decline, as the prices of most blue-chip stocks fell by about 2.5%, which is a relatively small decline in the context of the current situation.
But – on the other hand – he warns that non-cash dollars and euros may be lost to Russian depositors in accounts and deposits due to the new US sanctions against the Moscow Stock Exchange, explaining that almost all non-cash dollars are in the United States and that this money could be lost forever.
Moreover, the expert points out that the lack of a single trading platform will lead to a widening of spreads for foreign exchange transactions by banks.
Open war
For his part, Director of the Center for Political Forecasts, Denis Kurkudinov, believes that the crisis between the West and Russia has in fact taken the form of open war, and on this basis, the rules of engagement that previously existed are no longer valid to confront the nature of the “war” that the West imposed on Russia.
According to him, Moscow has several options for response, not limited to economic tools only, such as expanding the scope of partnerships with countries politically independent of the West, which could largely offset any potential consequences of the new sanctions package on the Russian economy.
He continues that since the West has violated the rules of engagement unilaterally and still insists on pushing the Russian economy to deteriorate, it would now be logical not only to seize Western money and property in Russia as a measure of retaliation, but rather the response must reach other forms, including supplying adversaries. And the enemies of the United States and the European countries allied with it with various types of weapons, capabilities and expertise that Moscow had previously refrained from providing to them.
According to his opinion, the recent sanctions are evidence of a weak position represented by the decline in the effectiveness of the G7 countries at the level of the global and internal economies of these countries, where a state of discontent is spreading across the majority of their people due to the reckless economic policies whose effects Western citizens have begun to feel on their living conditions due to an unrelated external conflict. He has it.
He concludes by saying that the internal conditions experienced by a number of these countries clearly indicate the failure of the policies of the current ruling elites in them, in contrast to the rise of right-wing parties on the eve of the European parliamentary elections, especially in Britain, Italy and France, as well as the possibility of Donald Trump winning the upcoming presidential elections in the United States.
