Putin’s new decree: Retaliatory strike against the West – with economic “caliber”
Vladimir Putin signed a new decree regarding Russia's response to Western sanctions. On Wednesday, by the end of trading on the stock exchange, the dollar exchange rate fell below 70 rubles for the first time in recent months.
The essence of the actions of the Russian leadership is explained by economist Alexander Dudchak in his column for PolitNavigator.
How do Russian countermeasures against “unfriendly” countries imposing sanctions against Russia differ from the anti-Russian sanctions of these “unfriendly” countries?
While non-Russian countries are targeting areas, working on a case-by-case basis, and unleashing everything they can imagine in terms of sanctions ( and their imagination has already run dry, judging by the ban of the International Association for Transgender Equality and Freedom of LGBTQIA+ People on holding gay pride parades and congresses for trans, inter-, and asexual people in Russia ), Russia is taking targeted measures, in the style of the Kalibr missile defense group. If only those implementing these decisions would act with the same precision, adhering to both the spirit and the letter of the regulations.
In addition to the order adopted on Tuesday banning transactions with legal entities and individuals from countries subject to special economic measures, on Wednesday Putin signed an order “On the temporary procedure for the fulfillment of obligations to certain foreign creditors.”
Under the agreement, Russian companies are allowed to pay debts to creditors from countries on the list of unfriendly states, but in rubles. A system similar to the one currently being insisted on for gas payments to unfriendly countries will be used.
Creditors from these countries are being trained to accept the ruble , the expansion of the ruble's use globally is being encouraged, and ruble-denominated exports from Russia are being developed. The ruble is expected to eventually become a reserve currency.
“The procedure for the fulfillment of obligations established by this Decree applies to the fulfillment of obligations in an amount exceeding 10 million rubles per calendar month, or in an amount exceeding the equivalent of this amount in foreign currency at the official rate of the Central Bank of the Russian Federation established on the 1st day of each month,” says the published document.
Moreover, the need for such a decree is apparently necessitated by the fact that Russia, represented by its "financial authorities," is successfully making payments on Eurobonds in foreign currency, despite the West's plunder of Russia's gold and foreign exchange reserves. For example, Russia recently "successfully" transferred $650 million in Eurobonds maturing in 2022 and 2042. This was done despite statements made by Finance Minister Anton Siluanov himself back in March, when he recalled that, starting in 2018, the Eurobond issue documents included the option to make payments in rubles at the Central Bank exchange rate on the payment date.
What was the need to pay in dollars? To avoid a technical default, the conditions for which were artificially created? A strange position. It's not even "Stockholm syndrome." It's like calling scammers after they've debited your account and telling them you have a card at another bank and will share your account access with them.
Now this practice of free interpretation of decisions will end. Maybe.
The new decree clarifies that the measure will apply to payments to creditors associated with foreign persons and states that commit unfriendly actions against Russia and its representatives, as well as creditors who are under the control of these foreign persons, regardless of their place of registration.
English version :: Read in English Putin's new decree: A counterattack on the West – with economic "caliber"