The Russian economy has managed to hold up against the massive sanctions imposed by Western countries and their allies over Moscow’s military operation in Ukraine, White House National Security Council spokesman John Kirby admitted on Friday.
As the conflict enters its second year, Washington revealed more anti-Russia penalties, targeting dozens of companies and individuals linked to the country, and raising tariffs on Russian goods whose imports were still allowed. Meanwhile, the EU approved its tenth package of sanctions against Russia, which includes export limitations on dual-use items and technology, measures against so-called Russian disinformation, and new restrictions against individuals and entities for their alleged support of the Russian military. Western allies Britain, Switzerland, Australia, Japan and New Zealand joined the measures.
Russia’s economy is “showing some resilience,” according to Kirby, who added, however, that it’s not clear whether this “can be sustained for the long haul.”
“He has had to take some drastic measures to prop up his economy, to prop up his currency, including playing pretty aggressively with interest rates, for instance,” Kirby said, commenting on steps approved by Russian President Vladimir Putin.
READ MORE: Russian economy will return to growth this year – Central Bank
Russian statistics service Rosstat reported that GDP of the sanctions-hit nation contracted by just 2.1% in 2022, much less than the 10-15% some had predicted after sanctions hit last March. The Russian economy is actually forecast to increase by 0.3% during the current year, according to the International Monetary Fund (IMF).
The strength of the Russian economy has been partially attributed to global prices for oil and gas, which saw a dramatic surge shortly after one of the world’s biggest exporters of the two commodities was targeted by Western sanctions. The growth of energy prices has reportedly compensated for the drop in the volume of the country’s exports.
At the same time, Russia managed to re-orient some of its exports, including energy sales, eastwards after Western buyers opted to shun direct shipments under the sanctions pressure.
The Russian national currency, the ruble, has also managed to stay afloat after bouncing back following a dramatic decline seen shortly after the sanctions were imposed last March. This has been attributed to strict capital controls, a dramatic interest-rate hike by the Russian central bank, and the country’s move to trade transactions with allied countries in domestic currencies.
The share of the ruble in Russia’s international settlements has doubled compared with December 2021. Last week, President Putin said that Moscow would continue to work with partners to form a stable and secure global payment system independent of the US dollar and of other Western currencies.
The ruble strengthened further after Moscow introduced a new payment mechanism from April 1. This requires nations that impose sanctions on Russia to pay for natural gas in rubles.
READ MORE: Western sanctions on Russia failed – Putin
President Putin has also attributed Russia’s economic resilience to the country’s strong agricultural sector. According to the latest data provided by Russia’s statistics service, the harvest amounted to 153.8 million tons, a 26.7% increase year-on-year against 2021.
“By the end of the agricultural year, that is, by June 30, 2023, we will be able to bring the total volume of grain exports to 55-60 million tonnes,” he said last week during his annual address to the Federal Assembly.
Meanwhile, parallel imports of non-sanctioned products and flourishing trade with countries that refrained from punishing Moscow had also contributed to the economic resilience. In addition, Russia has been successful in moving a lot of products to Asian markets such as India and China, and to Türkiye.
Additionally, Russia also had several years to prepare for sanctions following its reunification with Crimea in 2014. Moscow succeeded in developing an alternative to SWIFT, the messaging network that underpins global financial transactions. This came in response to Western threats to cut the country off from the international banking system.
The Russian authorities also created a national payment system called Mir as a domestic alternative to Visa and Mastercard, after Crimea-related sanctions were imposed. The Central Bank of Russia has issued some 150 million Mir cards since late 2015.
https://www.rt.com/business/572119-russia-economy-western-sanctions-ukraine/
Jonas E. Alexis has degrees in mathematics and philosophy. He studied education at the graduate level. His main interests include U.S. foreign policy, the history of the Israel/Palestine conflict, and the history of ideas. He is the author of the book, Kevin MacDonald’s Metaphysical Failure: A Philosophical, Historical, and Moral Critique of Evolutionary Psychology, Sociobiology, and Identity Politics. He teaches mathematics in South Korea.
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1984(ish)
Winston’s teeth were dropping out and access to State-run dentistry was only available to Party members.
Luckily for him teeth were no longer needed for the Citizens due to the meatless, mushy diet provided by The Ministry of Personal Logistics of Employment and Nutritional Technological Informatics (MiniPLENTI) which based nutritional requirements on what a Citizen needed for their service to Big Brother rather than what was required for a quality of life. The only reason Winston remained able to function was due largely to the Ministry Laboratory of Universal Vaccination (MiniLUV) regime which although its chemistry did not keep him free from illness it did enable him enough to contribute to Big Brothers economic and ideological programme ensuring it remained forever “the best of all possible worlds.” Ironically (at least to Winston) the Proles had the healthiest diet of all because of their ability to keep the odd chicken and cow and grow vegetables on minute plots of rough, spare land. Even more ironic was the reason that they were able to do this was that because their lives were deemed totally pointless they were largely ignored. As Party members constantly reminded the Citizens, what meaning has a life if it is not dedicated to Big Brother?
In principle the war effort is always so planned as to eat up any surplus that might exist after meeting the bare needs of the population. In practice the needs of the population are always underestimated, with the result that there is a chronic shortage of half the necessities of life; but this is looked on as an advantage. It is deliberate policy to keep even the favoured groups somewhere near the brink of hardship, because a general state of scarcity increases the importance of small privileges and thus magnifies the distinction between one group and another. By the standards of the early twentieth century, even a member of the Inner Party lives an austere, laborious kind of life. Nevertheless, the few luxuries that he does enjoy his large, well-appointed flat, the better texture of his clothes, the better quality of his food and drink and tobacco, his two or three servants, his private motor-car or helicopter — set him in a different world from a member of the Outer Party, and the members of the Outer Party have a similar advantage in comparison with the submerged masses whom we call ‘the proles’. 1984.
how did the reds survive sanctions.. ??
they just sat-bak and let the harvard-yalies-neo-nazis; fratt clubbers plan everyting !
boy ! id they get it rite wrong.. bolton foamers – kissingers fron the idel sidelines – running in for a reskue !
blowing up the krauts gas station/line — that was super thinking, and trying to snatch russian assets held by goldman and cru… yea=yea – come find em @ UrAnus !
lets see how the new dumas official policy of destroying the IMF goes… that a stated red policy of the finny minister w/n the dumas..
just a bunch of genetik dummies….
Since 1776, USA 🇺🇸 has only had peacetime for 17 years.
The biggest war criminal and terrorist of them all. Bullying other countries. Citizens of those countries despise us. Never promoting peace for the whole 🌎 earth. Enough with the damn wars already.
Americans are suffering. Palestine Ohio is in crisis. Many other states are in need. Trillions of dollars spent on stupid wars. The death tolls sickens me. At least President Trump kept us out of war during his presidency.
I believe that Ukraine is USAs war with Russia. If USAs borders were threatened they would attack too.
Why not promote peace? I gotta feeling one day USA will pay for her crimes.
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