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Moscow warns against new sanctions

By REN QI in Moscow | China Daily | Updated: 2021-04-17 07:29
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Russian and US state flags fly near a factory in Vsevolozhsk, Leningrad Region, Russia, March 27, 2019. [Photo/Agencies]

The latest array of sanctions imposed by the United States against Russia may not cause "big problems" on its state debt, but will definitely lead to a series of retaliatory measures, experts said.

Moscow reacted angrily on Thursday after Washington announced sanctions on Russia, including curbs to its sovereign debt market, to "punish" it for alleged election interference and hacking and other alleged "malign" actions.

The Kremlin said that planned US sanctions against Russia will not "help" a potential summit between Russian President Vladimir Putin and his US counterpart Joe Biden.

"What is currently being discussed-likely sanctions-will in no way help such a meeting. That is unambiguous," Kremlin spokesman Dmitry Peskov told reporters, referring to the summit.

While US Secretary of State Antony Blinken said Biden and Putin could meet "in the weeks ahead", Peskov said he was most likely referring to the aforementioned climate summit, not a formal in-person meeting that Moscow and Washington are mulling.

Alexander Murychev, executive vice-president of the Russian Union of Industrialists and Entrepreneurs, said: "As for the imposition of sanctions against the Russian public debt, personally, I do not see any big problems. The debt will become cheaper then-this is obvious. Nonresidents with big losses will sell our public debt, which will be bought by Russian commercial banks."

Optimism expressed

He said if banks lack liquidity, they will be able to obtain the necessary resources from the Central Bank of Russia.

Murychev added that despite the latest sanctions, foreign companies that have invested in the Russian economy are not likely to refuse to work in Russia.

"Of course, someone can refuse this. But I don't think the players who have been in Russia for a long time, who invested in fixed assets, in production, will lose their share in our market," he said.

"Politics is changeable but business is business," Murychev said. "It is important for business to make a profit. If someone has a strong niche in the market, I think they will hold on."

Simon Miles, a Russian studies expert from Sanford School of Public Policy at Duke University, said this is a critical time for ties between the US and Russia. He said observers should pay equally close attention to the Biden-Putin summit.

The steps announced by the Biden administration will be measured and reversible, Miles said.

"Sanctions to Russia are not exactly promising, as Russia has adapted to them, rather than taken steps to seek relief. Going after Russia's sovereign debt will likely cause more pain than those past efforts, but Russia's debt is not sizable, and rising oil prices are a boon for its economy," Miles said.

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