Mon 14 March 2022:
Russia’s finance minister admitted that over half of the country’s foreign exchange reserves are insufficient to survive Western economic sanctions.
According to Interfax, a Russian news agency, Anton Siluanov claimed on Sunday in an interview with Russian state television that Russia had roughly $640 billion in foreign reserves, with about $300 billion of that money frozen owing to sanctions imposed by the US, Europe, and other Western nations.
Following Russia’s invasion of Ukraine, the West imposed broad sanctions aimed at crippling the country’s economy.
Russia’s central bank and foreign exchange reserves were targeted in the first round of sanctions, reducing the country’s ability to support its economy and pay its war.
According to Bloomberg, Russia owned $100 billion in US dollars, or 16 percent of its foreign reserves, as of June 2021, citing information from the country’s central bank.
Euros accounted for another 32% of the foreign reserves.
Russia is on the verge of bankruptcy as a result of its invasion of Ukraine.
The stock market has closed, interest rates have doubled, and the rouble has dropped to its lowest level ever.
An unprecedented amount of international sanctions, backed by a vast coalition of countries, has compounded the military costs of war.
Because Russians can no longer shop at IKEA, McDonald’s, or Starbucks, they are unable to convert any of the money they do have into foreign currency.
Russia’s GDP will decline by 7% next year, rather than the 2% gain expected before the invasion, according to cautious estimates.
Others suggest that the drop might be as high as 15%.
The gold deposits of Russia are also being scrutinised.
A bipartisan group of US senators has proposed a law that would prevent Russia from accessing its $132 billion gold stash, according to Axios.
The central bank has upped its gold purchases since Russia’s invasion of Ukraine.
SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES
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