Considered as heavy as Russia’s exclusion from Swift, the measure makes it difficult to finance the war against Ukraine and use Russian foreign currency reserves to stabilize the ruble. 02/28). According to European Commission President Ursula von der Leyen, the restrictions include a ban on transactions with the financial institute.
In addition, all the bank’s assets in the EU must be frozen to prevent financing of President Vladimir Putin’s war against Ukraine.
The sanctions are considered to be as heavy as the exclusion of Russian financial institutions from the Swift banking communications network.
The EU’s punitive measures combined with those of its G7 partners mean that about half of Russia’s central bank’s financial reserves are frozen, EU foreign policy chief Josep Borrell said late on Sunday.
ruble plummets
According to experts, the measure prevents, for example, Russia from using its foreign currency reserves to stabilize the ruble. The Russian currency is experiencing sharp decline, which will bring more hardship to the people of Russia.
On Monday, the ruble hit a record devaluation against the dollar on Asian stock exchanges, despite the announcement by the Russian Central Bank that it would launch a series of measures to support domestic markets, affected by the sanctions. The Russian currency fell as much as 30% from its value on Friday, recovering slightly shortly afterwards.
Not all Russian central bank reserves can be blocked, according to Borrell, because not all of them are present in western states. He said the EU cannot block reservations in Moscow or China, for example, adding that Russia is increasingly hiding reservations in countries where they cannot be blocked.
Belarus and oligarchs in the crosshairs
Russia’s exclusion from the Swift system is also expected to take effect this Monday. The EU also plans to impose new sanctions against Russian ally Belarus and against Russian oligarchs, businessmen and politicians.
In a surprising decision, Swiss President Ignazio Cassis said it was “highly likely” that his government would decide on Monday to freeze Russian assets in the country, according to Swiss news agency SDA. He added that the possibility of following other countries in sanctions against Putin would also be on the table. Cassis also said any final decision on the capital freeze would have to take Switzerland’s neutral status into account.
Cassis had previously cited Swiss neutrality as a reason for not imposing sanctions despite the Russian invasion of Ukraine. Switzerland is an important financial center for Russians.
md (DPA, Reuters)
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