The government’s measure to allocate up to 1 trillion rubles from the National Wealth Fund (NWF) to buy shares in Russian companies will certainly support the market. This was announced to Izvestiya by Mikhail Kuzin, Investment Director of BCS Mir Investments, on Tuesday, March 1.
“It will depend on the volume, 1 trillion is a good figure, now we need to understand the procurement period,” he said.
Kuzin recalled that in 2008 VEB had already bought securities on the market. In October 2008, VEB received 175 billion rubles from the state, which went to support the stock market, they wrote on November 23, 2009 Vedomosti with reference to the words of Alexei Kudrin, then Deputy Prime Minister and Minister of Finance of Russia. With this money, the FNB bought securities of the largest Russian companies. After overcoming the peak of the collapse in the stock markets, Russian shares began to grow again, which brought VEB a profit of about 100 billion rubles.
On March 1, 2022, Russian Prime Minister Mikhail Mishustin instructed the Ministry of Finance to allocate up to 1 trillion rubles from the NWF to buy shares in Russian companies.
In addition, Mishustin said that the Cabinet of Ministers is going to temporarily restrict foreign businesses from exiting Russian assets. The head of government expressed hope that those who invest in the Russian market will be able to continue working in the country.
French Finance Minister Bruno Le Maire also said that the European Union plans to economically suppress Russia by starting a global financial war. The head of the department added that the sanctions would be applied until Moscow took the path of de-escalation and returned to “the best intentions” regarding Ukraine.
The Kremlin said that aggressive actions against Russia are ultra-concentrated, but they have taken place before. They stressed that Europe is mistaken, believing that by imposing sanctions they can force Moscow to change its position.
On February 28, the US Treasury banned transactions with the Russian Central Bank, the Treasury and the National Welfare Fund. Also on February 24, Washington imposed sanctions on a number of companies with state participation or organizations important to the economy and on “two companies dominated by private capital.” US and EU restrictions also affected several Russian banks.
Against the backdrop of sanctions, the Bank of Russia announced additional measures to support credit institutions. He stated that he has the necessary resources and tools to maintain financial stability and ensure the operational continuity of the financial sector in the country. The regulator also decided to raise the key rate to 20%.
The sanctions came in response to the Russian-led operation to protect Donbass, which Russian President Vladimir Putin announced on February 24. The Russian side emphasized that it does not hatch plans for the occupation of Ukrainian territory, and strikes are carried out only on the military infrastructure of the Armed Forces of Ukraine.
The situation in Donbass escalated on February 17. The DPR and LPR complained about the shelling by the Ukrainian security forces, including from heavy weapons. The republics announced a general mobilization, the evacuation of civilians to the territory of Russia, and also asked to recognize their independence. On February 21, the President of the Russian Federation signed decrees recognizing the sovereignty of the Donetsk and Lugansk People’s Republics.
For more up-to-date videos and details about the situation in Donbass, watch the Izvestia TV channel.
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