Russia will settle its debts with countries on its list of enemies only by paying them back in rubles.
Russia’s list of enemies is growing, now including all 27 members of the European Union, as well as the United States, United Kingdom, Canada, Australia, Switzerland, Monaco, Norway, Iceland, San Marino, Japan, South Korea, New Zealand, Singapore, Taiwan, and Micronesia.
The Kremlin yesterday added three Balkan states to its list of enemies after they joined tough EU sanctions against Russia. Montenegro, North Macedonia, and Albania are on the enemy state list. EU candidate country Serbia has not been included on the list as it has so far refused to enforce sanctions against Russia.
Debts will be settled with this big list in rubles only.
In addition, any business and corporate deals made between Russian businesses and individuals or entities on its enemies’ list will require the approval of a Russian government commission.
The ruble is currently tumbling at a tremendous speed due to Western sanctions. The ruble has lost nearly half of its value against the dollar since the beginning of 2022, with a sharp loss accelerating since Russia invaded Ukraine on February 24. Following Russia’s invasion, sanctions swept in from governments around the world.
Finance experts said that the future of the ruble does not look bright for Russia due to the combination of sanctions, the rising risk of default, and the incentive to divest from ruble-denominated assets.
Economics experts have also said that because Russian prices against the Euro are so poor, this will go on for a long time and that no one will want to be associated with the ruble. Head of global EM research at Oxford Economics Gabriel Sterne said people should sell their rubles at a loss because there is very little demand for these assets at the moment.
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