Elena Panina: The West must understand that Russia will resist

20:35, 03 марта 2022

МОСКВА, 03 марта 2022, Институт РУССТРАТ.

When the war is being waged on all fronts, it is necessary to respond in kind. And we have options for such a response, says Elena Panina, director of the RUSSTRAT Institute

The military special operation continues in Ukraine. But the set of sanctions that the West has brought down on Russia is a real war. Moreover, it has been conducted for a long time, and now it has taken an unprecedented acute form.

They want to convince us that the whole world is against us. However, the international isolation of Russia through sanctions is a myth. They were not supported not only by China, Argentina, Brazil, Mexico, Moldova, Georgia, Kyrgyzstan, but also by such close allies of the United States as the United Arab Emirates and Israel. India has not made a decision. Even Japan treats them with extreme restraint, especially in the field of energy. By the way, a separate story is the United States itself. Please note: they did not bring their “Boeing”, energy, and space under sanctions against us.

At the same time, what we are seeing in the EU country is nothing but sanctions hysteria, and politics has so eclipsed common sense that it is quite appropriate to apply a Russian folk saying: once such a drunkenness has gone, cut the last cucumber. In this situation, we must give a much tougher and more adequate response. When the war is being waged on all fronts, you need to respond in kind. And we have options for such an answer.

Why, for example, do we still supply our energy resources to Germany and the EU countries if they supply lethal weapons to Ukraine? Can you imagine a situation when Guderian tanks are going to Moscow, and the Soviet Union supplies the aggressor with fuel for these tanks? It is necessary to stop the supply of oil and gas to those states that, in fact, are fighting against us. They need to answer.

And it’s not just about energy resources.

The same “Boeing” company, whose products the United States did not forbid us to buy, covers its titanium needs by 35% at the expense of Russia. The same applies to uranium concentrate, which Russia supplies for American nuclear power plants. And this is not the whole list of possible counter-sanctions on our part, and not only raw materials are on this list. And we will do without the same «Boeing» — we will develop our aviation.

The West must understand that Russia is resisting, and will continue to resist this pressure. The tougher our response will be, the more impression it will make on those whom the West is pushing to isolate Russia, but who are refraining from sanctions so far. Many countries are watching how events will turn out, how it will end. And not only because they don’t want to get into the sanctions meat grinder. But also because many peoples have a strong rejection of the world order that the United States imposes everywhere. Now comes a certain sobering up.

Western business should also understand that its losses in the event of withdrawal from Russia will be very significant. Using the example of British Petroleum, which was forced to leave by British politicians, we see how much it loses. Dividends from operations in Russia alone amounted to $640 million last year, and in general, BP management has already announced the write-off of $25 billion in losses due to the exit from Rosneft. And it’s definitely not a business choice. The company was simply politically bent.

After Prime Minister Mikhail Mishustin announced an absolutely correct measure in the conditions of a total sanctions war against Russia — a ban on the withdrawal of foreign assets from Russia, the losses will be even greater. And for Western business, and for the economy of Europe as a whole.

In addition, we must understand that if such large companies as BP or Shell, politicians can bend, then it is almost impossible to force tens or even hundreds of thousands of enterprises and firms to stop supplies to the Russian market. For many of them, it will be equivalent to bankruptcy.

Opponents of a tough response tell us: «there is no need to quarrel, there is no need to cut off gas supplies to the West — they say there will be no currency, and this is unacceptable in a situation of freezing gold and foreign exchange reserves.» Let’s do the math.

Today we have $643 billion in gold and foreign exchange reserves. Minus monetary gold, the value of which in current prices is approximately $132-135 billion, and it is in our, thank God, vaults. The Ministry of Finance and the Central Bank managed to transfer part of the foreign exchange reserves to other jurisdictions. Thus, the losses from the freezing of gold reserves may amount to approximately $200 billion. This is also a lot. But if our currency exporters, in accordance with the government’s decision, start leaving 80% of the currency they receive in Russia, we will receive about $450-500 billion a year. This compensates for the frozen assets of the Central Bank. In addition, there are other possibilities.

As for gas sales abroad, we should limit them, of course, only to those countries that have declared economic war on us. We have other markets. Contracts for the supply of 48 billion cubic meters of gas per year have been signed with China alone. This is comparable to the design capacity of Nord Stream 2.

Now the main thing. Taking into account the measures taken by the government to preserve the currency in the country, there should be enough resources to support the population. I believe that the Central Bank’s decision to raise the key rate to 20% should be accompanied by measures to support mortgage lending. Now commercial banks have raised the mortgage interest to 18-19%. I hope that a number of measures will be taken to solve the problems not only of business, but also of the population. Although, of course, business needs to be supported.

It is necessary to switch to a social mortgage through the Housing Mortgage Lending Agency. And this will play not only a social role, but also an economic one – housing construction is always a driver of economic growth.

It is necessary to issue special loans for enterprises under state programs, as was done in the agricultural sector through special programs and preferential 5% special loans, which allowed us to withdraw our agricultural sector from dependence on external purchases.

All these measures are known. It is important that they are not late and are clearly implemented at all levels.

This is the first really serious clash between Russia and the West. I think that it will not be the last, the war against us will continue further, heaven forbid that this does not turn into a major world war. But the fact that we have pushed the threat away from our borders for at least a couple of decades and found a way to defend our place in the world is already a fact.