Tags: russia | ukraine | eu | sanctions | economy

Russian TV Anchor Complains 'We Can't Buy What We Need' Due to Sanctions

By    |   Wednesday, 14 December 2022 05:03 PM EST

Russian TV anchor Ivan Trushkin has complained about the impact of sanctions imposed on Moscow following its invasion of Ukraine. He said the financial struggle will be "even more pronounced" for Russians in 2023.

During a segment of the show "Mesto Vstrechi" on Russia's NTV channel, Trushkin asked a guest why Russia had access to different currencies, "but we cannot spend them on what we want because of those very sanctions."

The guest replied, "We can spend it on what we want," triggering Trushkin to interrupt, "I mean on what we need," before adding, "I do not understand anything."

Ukraine's interior affairs adviser, Anton Geraschenko, clipped the video and tweeted, "'We can buy what we want. We can't buy what we need.'" He added, "Sanctions are working."

Since the invasion, the EU, the U.S., and other allies have isolated Russia from the global financial system. They froze Moscow's access to some of its foreign reserves and booted it from the SWIFT global banking system.

Russia's GDP in 2022 was predicted to fall 15%, but it remains better at 3% as it has been buoyed by higher prices for its main gas and oil exports.

"Nevertheless, sanctions, oil and gas embargoes, high inflation, capital outflows, and lower business investment have dragged Russia into a recession," Olga Bychkova, an economist at Moody's Analytics, told Newsweek.

"Sanctions imposed by the West on the Russian financial sector have made it impossible to conduct payment and insurance transactions as before," she said.

Sanctions have restricted access of Russian companies to foreign markets, causing disruption in technological, production and logistics chains.

It has impacted exporters who cannot sell their products to certain counties and Russian companies which use imported parts, causing a decline in manufacturing.

"Russia is in for a sizable recession in 2022, which will continue in 2023 without a rebound as sanctions deepen their bite into the economy," Bychkova said. "The effect of sanctions adopted in mid-2022 with their effective periods postponed to late 2022 and early 2023 will become more pronounced."

In early December, Russia’s private Alfa-Bank cautioned of a "deeper contraction" of Russia's market next year of as much as 6%, although assessments put it lower. Reuters predicted inflation to hit 12.1%, up from 8.4% in 2021.

Western nations have enacted a $60 cap on the price of seaborne Russian oil to curb Putin's financing of the war. In response, Russia assembled a fleet of tankers aimed at navigating past that cap.

"If Russian oil exports plummet, this will provoke inflationary pressure due to a contracting balance of trade and a weaker ruble," Bychkova said. "A lot will depend on how much oil the country will be able to redirect to other markets as well as the extent to which the slump in oil exports will be offset by price."

Moody's Analytics projected about 4 million of Russia’s 7.5 million barrels per day of oil exports will be transferred by the end of the first quarter of 2023, with almost half rerouted to non-Western nations.

Energy exports will produce a trade surplus for Russia, but its economy is anticipated to become "much more insular," according to Bychkova.

"Even as high oil prices cushion the hit in the short term, the loss of foreign technology, financing, and knowledge exchange will take a significant toll on Russia's energy market in the medium term, especially on LNG projects, which are still in their infancy."

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Russian TV anchor Ivan Trushkin has complained about the impact of sanctions imposed on Moscow following its invasion of Ukraine.
russia, ukraine, eu, sanctions, economy
571
2022-03-14
Wednesday, 14 December 2022 05:03 PM
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