Thread by @ABarbashin

How will #sanctions hammer Russian economy? Thread based on insightful @maria_shagina piece for @RiddleRussia
"Unwilling to counter Russia’s atrocities in Ukraine with direct military involvement, the West has opted to wage all out financial warfare" 1/8
ridl.io/en/an-unpreced…

First, we should note the unprecedented unity and speed of sanctions introduced. If in previous confrontation cycles it took ages for EU to get sanctions agenda agreed now it is extremely fast. Also, new nations join unified sanctions front - Singapore, Switzerland and Korea 2/8

First tool is the full blocking sanctions for state-owned second-largest bank VTB and a handful of other financial institutions (Sovcombank, Otkritie and Novicombank). US and UK also prohibited any dollar and sterling transactions for Russia's largest Sberbank 3/8

Some banks were blacklisted from SWIFT but not all. Especially banks crucial to energy trade, like Gazprombank. Potential for escalation here is obvious
"The short-term impacts will be unsettling" 4/8

The biggest hit so far is Central Bank sanctions. Out of $630 billion of Russian savings, $400 billion are now frozen. Rest in Yuan and gold are not easy to convert.
So, the main "stability tool" is basically inaccessible to Putin 5/8

"Russia is experiencing an exodus of Western businesses due to reputational costs. Regulatory uncertainty and lack of conformity have accelerated achilling effect among foreign banks and international conglomerates" 6/8

"The objective of the new sanctions is not to change the Kremlin’s calculus, but to erode Russia’s economic capacity to continue financing the war. Having failed at deterrence, the West’s sanctions of unprecedented measures are largely about punishment and constraint" 7/8

On the scale of 10, the current pressure of sanctions equates to 7 or 8.
For more details, read this @RiddleRussia @maria_shagina piece 8/8
ridl.io/en/an-unpreced…