Economist: Exploiting Russia’s Desperate Situation Is Highly Profitable Now
- 8.01.2024, 14:40
12 packages of sanctions have seriously hampered the capabilities of the Russian economy.
The sanctions imposed around the world against the Russian Federation are working. At the same time, sanctions could be more effective if a complete ban on Russian products were introduced, rather than restricting imports.
This was reported by RBC-Ukraine with reference to economist Andriy Novak.
“Of course, we in Ukraine would like much tougher sanctions against the aggressor country, and that they be on a larger scale. But historically it has always been the case that war makes some people rich. Now it is very profitable to take advantage of Russia’s desperate situation, because it sells its products at dumping prices. But still, the 12 packages of sanctions that have already been adopted have seriously hampered the ability of the Russian economy to finance the war against Ukraine,” Novak emphasized.
He noted that Ukraine should be grateful to the countries and international organizations that have imposed sanctions against Russia. But in the future, sanctions against Russia should be stricter and tougher, because the war and global economic problems are already beginning to hit the main world players.
“The practice of restrictive prices on, for example, Russian gas and oil products has shown that, on the one hand, this mechanism supposedly works, but Russia manages to find workarounds. And therefore the most effective sanctions are not restrictive, but prohibitive. And if there is a complete embargo, for example, on Russian energy resources or Russian metals, then this will be a serious blow to the corresponding area of the Russian economy. And any restrictions can always be circumvented,” Novak concluded.
The 12th package of EU sanctions provides for a ban on the import of Russian cast iron and renewable iron, but this ban will take effect only after 2 years.
Previous sanctions on the import of slabs were introduced in October last year, as part of the 8th package of sanctions: then it was decided that it could continue until the end of September 2024 within the established quotas, and from October 1, 2024, imports should stop.