What sanctions is Russia currently facing?
Restrictions can be divided into economic, political, and travel. The European Union and the United States prevented Russia from importing advanced technology or weapons. Selected Russian companies and banks cannot raise capital in the West, and the Russian state is not allowed to sell newly issued government bonds there. In addition, domestic banks are not allowed to trade with their Western counterparts in dollars, euros, pounds or Japanese yen. In addition, the anti-Putin coalition cut selected Russian banks from the SWIFT banking system, freezing about half of the foreign exchange reserves held by the Russian Central Bank in Western countries.
The sanctions have also affected several hundred Russian businessmen and politicians, including President Vladimir Putin and his Foreign Minister Sergei Lavrov. Jim and other people on the EU sanctions list, along with the United States, have frozen their assets on their soil. Selected Russian officials are also prohibited from traveling to the European Union and the United States.
The only exception is Putin and Lavrov traveling to the European Union so that they can participate in possible peace negotiations. In addition, the European Union has already closed its entire airspace to Russian Airlines aircraft. Restrictions on reciprocal trade and sanctions against selected persons also apply to Belarus, which helps the Russian Federation advance towards Ukraine.
What does freezing of Russian state reserves mean?
This is one of the most powerful measures taken by the West against Moscow. Before the attack on Ukraine, the Russians had been amassing large foreign exchange reserves for several years, which now amount to $643 billion. This amount served as a cushion against retaliatory economic actions of Western countries. But now Russia cannot use more than $300 billion of this amount because it is frozen in Western countries where it is owned by the Russian Central Bank.
As a result, the Russian ruble fell by tens of percent on Monday. So far, the Russian Central Bank has kept its feet, mainly by selling Western currencies. But he can no longer actually use this tool. Despite the efforts of central bankers to support the ruble in a different way, economists estimate that it will continue to weaken significantly. The Russians are now trying to get access to dollars and other Western currencies. However, due to the embargo on Russia, it is likely that they will soon become a rare commodity.
Of course, due to the sharp weakness, there is no interest in the ruble now. So economists predict that Russia may eventually offer limited convertibility to its currency, which is already in effect. “In this case, it would be a return to the communist era, when the ruble was
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