Economics/Class Relations

Sanctioning Russia could topple the West

By The Unherd

The West, following the lead of the United States, has reacted to Russia’s invasion of Ukraine by introducing a “crippling” regime of sanctions. It is a “total economic and financial war” aimed at “caus[ing] the collapse of the Russian economy”, the French finance minister Bruno Le Maire candidly admitted. And yet many of the current sanctions appear to be run-of-the-mill restrictions used against several countries in the past. A number of them — including export bans and the freezing of certain assets — have been imposed on Russia since its annexation of Crimea in 2014. Even the much-discussed exclusion of a number of Russian banks from the main international banking message system, SWIFT, is not new, having already been used against Iran, with mixed results.

The most controversial aspect of the new sanctions regime is without a doubt the freezing of Russia’s offshore gold and foreign-exchange reserves — about half of its overall reserves — but even this is not unprecedented: last year, the US froze foreign reserves held by Afghanistan’s central bank in order to prevent the Taliban from accessing its funds; the US has also previously frozen the foreign-exchange reserves of Iran, Syria, and Venezuela.

So, taken individually, these measures are not as exceptional as they’ve been portrayed. However, never before have so many sanctions been deployed at once: there are already 6,000 various Western sanctions imposed on Russia, which is more than those in existence against Iran, Syria and North Korea put together. Even more importantly, none of the previous targets of sanctions were remotely as powerful as Russia — a member of the G20, and the world’s largest nuclear power.

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