Russia responds to US sanctions, says it will give ‘strong’ and ‘painful’ response

The country’s Ministry of Finance also indicated that it is closely monitoring the situation in international markets following the action of the US government.

EFE/EPA/ALEXANDER ZEMLIANICHENKO/ POOL – 09/3/2021Vladimir Putin, President of Russia

After the sanctions of U.S (USA) and other countries, such as Japan, Russia spoke out this Wednesday, 23, and promised a “strong” and “painful” response. In a statement by the Ministry of Foreign Affairs, the country led by Vladimir Putin stated that there should be no doubt about his position on the issue: “there will be a strong response to these sanctions, not necessarily symmetrical, but well calculated and painful for the United States”. The sanctions on the European country were announced on Tuesday after Putin recognized the independence of two Ukrainian breakaway regions, amid escalating tensions with Ukraine.

The official note from Foreign Affairs states that the US measures are the 101st round of penalties against Russia and that the Americans’ intention is “to try to change the course of Russia”. “Despite the evident futility of efforts made over the years to hinder the development of our economy, the United States is again using restrictive instruments that are ineffective and counterproductive from the point of view of American interests,” the text reads. “We affirm that the arsenal of American foreign policy, imprisoned by the stereotypes of a unipolar world – with the false conviction that the United States has the right and can impose its own rules of the world order – has no other means than blackmail, intimidation, and threats”, completes the note.

Also on Wednesday, the Russian Ministry of Finance indicated that it is closely monitoring the situation in international markets, after the sanctions imposed by the United States on transactions with sovereign debt securities of the Eastern European country. The ministry also informed that, despite all the impact of the American measures, it is able to minimize the damage and that it will adopt measures in favor of financial stability. “The Russian Ministry of Finance, together with the Central Bank of Russia, will continue to closely monitor the situation in financial markets and, if necessary, take additional measures to strengthen financial stability,” the statement said.

In addition, Finance reported that, in order to face the risks of forced sales, government values ​​by certain foreign investors, the placement of bonds, after February 22, will be done through the issuance of new securities registered before that date. “With the aim of helping to strengthen stability in the Russian debt market, decisions on the placement of bonds in the coming weeks will be taken taking into account market conditions,” the ministry said in a statement. According to the Ministry, the Russian Treasury has an “important amount of funds temporarily available”, of 4.5 trillion rubles. [equivalente a R$ 287,4 bilhões] against 2.2 trillion rubles [R$ 140,5 bilhões] which it is expected to raise on the market in 2022. “This allows for a flexible focus on the bond placement calendar.”

Last Tuesday, the 22nd, the US president, Joe Biden, announced a first package of sanctions against Russia, in response to what it called “the beginning of the Russian invasion of Ukraine”. “We are implementing comprehensive lockdown sanctions against Russia’s two leading financial institutions, VEB [um dos maiores bancos de investimento e desenvolvimento] and its military bank,” Biden said. The US must also implement comprehensive sanctions on Russian sovereign debt: “This means that we cut western funding for the Russian government“, said the American president. The measure was a response to the formal recognition of the independence of the breakaway republics of Donetsk and Lugansk, in eastern Ukraine, and the authorization to send troops to Donbas. Canada, the European Union, Australia and Japan have also imposed or announced the first sanctions against Moscow, in response to the latest Russian actions.

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