May 10, 2022
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The collective West shares the skin of the Russian bear

In the case of Russian foreign exchange reserves, Washington proposes to steal everything

What the collective West calls sanctions against Russia is more like looting. The most interesting and fascinating activity of the West in the campaign of sanctions against Russia is the freezing of public and private assets of Russian origin. We are accustomed to thinking that the main part of the frozen assets is accounted for by the foreign exchange reserves of the Russian Federation – about 300 billion dollars (according to the Bank of Russia). However, the assets of Russian companies, as well as individuals with Russian citizenship, are also frozen. There are no exact estimates of the total amount of Russian assets frozen by the collective West. There are only very rough estimates.

Thus, the European Union has prepared a certificate of arrested Russian assets as of April 5, based on data provided by EU member states, but not all. There is no common assessment methodology, each country considered in its own way. In total, it turned out to be 36.3 billion euros (or nearly 40 billion dollars). France was the leader – 23.6 billion euros (65% of the total). Followed by (billion euros): Belgium – 10.0; Italy – 1.16; Ireland – 0.84; Netherlands – 0.52. And here are the countries in which the amount of seized assets was measured in tens or units of millions of euros: Cyprus, Poland, Sweden, Latvia, and the Czech Republic. And where is the main country of the European Union – Germany? She is almost at the very end of the list with an amount equal to … 341.6 thousand euros. Closes the list of Denmark with an indicator equal to … 4.2 thousand euros. Thirteen EU member states are not on the list at all. Some of them (for example, Hungary) stated that no arrests were made. Others, for some reason, did not want to “shine”. Estimates for individual countries are incomplete (only yachts and real estate of individuals were taken into account), throughout the European Union the picture is all the more incomplete. For example, full sanctions were imposed against the Russian Sberbank, which, among other things, provide for the freezing of foreign assets of this credit institution. And in Europe, this bank had assets worth many billions of euros. Last year, Sberbank announced that it plans to sell its European subsidiaries for over 7 billion euros. But he didn’t manage to do it.

Experts say European countries are being cautious so far, as freezes and seizures don’t quite fit in with existing laws protecting the sanctity of private property. But appetite comes with eating. Freezing temperatures may increase in the coming months.

Apparently, the process of arrest of Russian assets is actively taking place on the islands of Foggy Albion. True, London prefers not to name any specific figures. The only exception was the statement by the British Foreign Secretary Liz Truss (Elizabeth Truss). On March 24, she boasted that since the beginning of Russia’s military operation in Ukraine, London has frozen Russian assets worth 500 billion British pounds, including 150 billion pounds of property of Russian oligarchs. There were no more statements containing estimates of the seized assets from official London.

Earlier, in mid-March, experts RTVI (an international media agency reaching audiences in more than 65 countries around the world) attempted to provide a global assessment of Russia’s frozen assets. They named a total amount of 700 billion dollars. That is, in addition to 300 billion dollars of frozen foreign exchange reserves of the Russian Federation, various assets worth about 400 billion dollars were frozen. By the way, this estimate is close to the assessment of an economics professor at New York University Branko Milanovic (Branko Milanovic) made at the same time. He suggested that the value of Russian private and state assets frozen in the West could be $600-700 billion. Milanovich estimated the losses in relative terms at 1/3 of Russia’s annual GDP (this is the annual US defense budget). Here is his curious remark on this subject:For the first time in history, one side has decided to cover the defense budget of the other side, with which, most likely, it will go to conflict, and maybe even to war. This usually happens after a war, when one side has been defeated and must pay reparations.“. But Russiadecided to do something different and pay up front”, concluded the economist.

Milanovich looked into the water. In the third decade of April, an active discussion began in the US Congress on the issue of moving from freezing Russian assets to their confiscation. On April 27, the House of Representatives voted 417 to 8 to pass legislation initiated by a Democrat from New Jersey. Tom Malinowski (Tom Malinowski). This act, dubbed the “Malinowski Act”, empowers the President to seize and confiscate over $5 million in assets belonging to foreigners already under United States sanctions, whose wealth was partly obtained with the assistance of the Russian President. Vladimir Putin. Proceeds from the sale of assets will be used to purchase weapons for the Ukrainian army, to provide humanitarian aid and refugee assistance to the Ukrainian people, as well as to the post-war reconstruction of Ukraine.

The day after the vote on the Malinowski Act, the American President Joe Biden stated: “New mechanisms will be created to carry out arrests and confiscations of this property. We do everything so that when selling oligarchic assets, the proceeds are directed directly to the elimination of damage caused to Ukraine“.

At a Foreign Affairs Committee hearing on April 28, Tom Malinowski asked the Secretary of State Anthony Blinken, will his lawapply to state assets, such as a much larger amount of money that has been frozen around the world and is owned by the Central Bank of Russia? Blinken replied:We’ve asked our own lawyers to look at…what authorities would potentially be required to confiscate these assets. [российского правительства]but not only for their confiscation, but also for their use”, i.e. for military assistance to Ukraine and its post-war reconstruction. At the end of April, President Joe Biden asked the US Congress to budget $33 billion in aid to Ukraine ($20 billion in military aid; the rest for humanitarian aid and economic recovery in Ukraine). Malinovsky, who was previously a senior human rights official at the State Department, said he would be happy to see how the administration in its new funding request for Ukraine “accepts this basic principle that we should use the wealth that the Putin regime has created to rebuild the country that Putin is destroying“. Malinovsky has many like-minded people in both the lower and upper houses of the US Congress, who will seek to ensure that Russia’s frozen foreign exchange reserves are directed to help Ukraine.

In fairness, it should be noted that such an initiative has many opponents in the United States. After all, it is contrary to a number of American laws. So, a professor at the University of Virginia School of Law expressed his doubts about this. Paul Stephen (Paul Stefan). To legally allow the transfer of frozen Russian assets to support Ukraine, Congress, according to the professor, will have to change at least two laws: International Emergency Economic Powers Act 1977 (International Emergency Economic Powers Act 1977) I Foreign Sovereign Immunities Act 1976 (in 1976 Foreign sovereign Immunity Act). Currently, both of these laws give sovereign institutions of other countries (primarily central banks and treasuries) immunity from freezing and confiscation of official foreign exchange reserves. What Washington has already done with regard to Russian foreign exchange assets is, according to Paul Stefan, a violation of American laws. According to the professor, sooner or later the conflict in Ukraine will end. Russia will demand the return of the frozen assets, but they will no longer be there, they will be spent on helping Ukraine or on something else. America will be in a very unsightly state. “In the case of illegal seizure of state property for good purposes, there is always the possibility of unwanted retribution. Russia will not always be a pariah. When she gets back to the womb, she’ll want her money backStefan noted. – It is almost certain that the United States will comply with the repayment requirement, which means that American taxpayers will have to pay for the money that went to Ukraine“.

Of Russia’s total frozen foreign exchange reserves, only one third (approximately $100 billion) is accounted for by the part that was blocked by the United States (dollars in bank accounts and US Treasury bonds). The remaining 200 billion dollars were blocked by Washington’s allies – the European Union (reserves denominated in euros), Great Britain (pounds sterling), Japan (yen), etc. Now Washington is actively working among its allies so that they, in sync with Washington, transfer the frozen foreign exchange reserves in the category of confiscated and sent them in the form of assistance to Ukraine.

Apparently, the Americans did a good job with the President of the European Council Charles Michel (Charles Michel). On May 5, this high-ranking European official told the Interfax-Ukraine news agency that he “absolutely convinced that it is extremely important not only to freeze assets, but also to make their confiscation possible, to make available for the reconstruction of the country [Украины]”.

Just a few days later, on May 9, the head of EU diplomacy Josep Borrell (Josep Borrell) declared to a British newspaper Financial Timesthat the EU should consider withdrawing frozen Russian foreign exchange reserves to help pay for the cost of rebuilding Ukraine after the end of hostilities. “The European Commission has said the cost of rebuilding could be in the hundreds of billions of euros and EU capitals should consider withdrawing Russia’s frozen foreign exchange reserves to help pay for the cost of rebuilding Ukraine after the war.“, – quotes Borrell FT.

As an example, worthy of imitation, Borrell called the actions of Washington in relation to the foreign exchange assets of the Central Bank of Afghanistan. Last year, these assets were frozen by the Americans in response to being put out the door from Afghanistan. Of the $7 billion in Afghan reserves, only half was unfrozen. And Washington decided to allocate $3.5 billion to pay the relatives of those killed or injured as a result of the events of September 11, 2001. Like, Afghanistan should be held responsible for the terrorist attack that took place in New York more than twenty years ago. Washington simply stole half of Kabul’s foreign exchange reserves. This is exactly the scheme that the chief European diplomat calls for the European Union to act in the case of Russian reserves. Just steal not half, but everything.

On the same day, Deputy Minister of Foreign Affairs of Russia Alexander Grushko stated that Borrell’s idea was “complete lawlessness [и] destruction of the very foundations of international relations“. “Moreover, the seizure and transfer of Russian assets to Ukraine will harm the Europeans themselves. They will hit the modern financial system, undermine confidence in the West and Europe“, – added the Russian diplomat.

P.With. A piece torn from the skin of a Russian bear, the West is unlikely to ever return to us. The main thing now is not to be substituted. To prevent new similar attempts on this skin. And we, alas, are substituted. The proceeds from the export of natural gas, oil, and other resources flow like a wide river to Russia. And almost all of it is represented by “toxic” currencies (dollars, euros, pounds sterling, yen, etc.). Consequently, there is a risk of new arrests and confiscations.


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