According to the former Minister of Finance of Russia, Chairman of the Committee of Civil Initiatives Aleksey Kudrin, the impact of sanctions on the Russian economy has gradually reduced, as the economy adapted to the new conditions. He stressed that in addition to a number of financial restrictions, the sanctions against Moscow involve reputational risks, which large foreign companies working in Russia has to deal with. According to him, anti-Western rhetoric, which is typical for a number of media outlets, discourages highly qualified professionals to work in the country.
A professor of the department of Finance, money circulation and credit at RANHiGS Yuri Yudenkov in an interview with a ‘Vestnik Kavkaza’ correspondent, expressed an opinion that the Russian economy has partially managed to neutralize the effect of the sanctions.
‘‘The main goal of the restrictive measures taken by a number of states in relation to Russia after the events of 2014, was to deprive our country of an access to the technologies and the long-term (over three months) credit market," he said, adding that his gap was filled by China and until recently by Turkey.
"With regard to access to the long-term credits, the situation has only worsened. We still have no access to the interbank loans. Moreover, the US banking system is prohibited from buying Russian securities.Therefore, the sanctions continue to have a negative impact," Yuri Yudenkov said.
Speaking about Moscow’s response, Yudenkov mentioned that the country stopped buying agricultural produce from the countries that supported the sanctions. The situation in this sphere is quite different. “There is some progress in the import substitution sector,’’ the expert said.
In addition, he pointed out that if the sanctions are lifted, we should expect Russia’s return to the European finance market.
"It is inevitable. The yesterday's decision of the Hague Court shows that in principle the rules of the game stayed the same. And the financial community interpreted this rules correctly. Since it is the US Federal Reserve that runs the show, it is the US Federal Reserve sets the rules of the game today. That is why Europe is being forced to follow," Yuri Yudenkov concluded.
The head of the Capital Markets and Financial Engineering of the Department of Finance and Banking at RANHiGS Konstantin Korischenko agreed that Russia was only partly able to neutralize the effect of the sanctions.
"We have succeed in import substitution because the domestic manufacturers began to fill the niche vacated by the imported goods. We have poor results in substituting for the equipment, materials and components used in manufacturing of complex technological products,’’ the expert said.
Korischenko also said that anti-Western rhetoric is not the main reason why Western investor are careful to invest in Russia. They are afraid of a possible intervention by the United States in the cash account transactions and the finansial markets, as was the case with the release of the Russian Eurobonds.
‘‘This factor may be mitigated only after a solution to the problem, which is being discussed by everyone, is found. It means an implementation of the so-called structural reforms. Above all, this means involving domestic resources. We are living under the sanctions.
Of course, it is better if they are lifted. But in any case, the question is: who is willing to take serious and long-term risks investing in this or that project," said Korischenko.
