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20 May, 2022 15:10

Moscow outlines financial priorities

De-dollarizing the Russian economy is critical, prime minister says
Moscow outlines financial priorities

The US, EU and other Western nations are using their currencies as a tool of blackmail against Russia, Russian Prime Minister Mikhail Mishustin said at a council of CIS countries videoconference on Friday.

The dollar and the euro are increasingly being used as an instrument of political pressure and economic blackmail,” the official stated.

According to Mishustin, in the face of sanctions Russia has to strengthen interaction with its partners and make more active use of multilateral mechanisms. In particular, agreements should be reached on a free-trade zone, cooperation in transport and logistics, as well as the use of national currencies in mutual settlements between CIS countries.

The prime minister stressed that Russia’s “focus remains on de-dollarization,” meaning eliminating the use of the US currency in settlements.

Over the past two months, Russia has faced an unprecedented number of economic restrictions, ranging from the freezing of the country’s foreign reserves to bans on transactions with its financial institutions. As a result, many Western companies decided to stop doing business in the country. Russia may also face a technical default on its debt obligations, as the US has threatened to block payments on its dollar-denominated bonds.

However, Russia’s countermeasures, such as capital controls, a sharp hike to the key rate, and a new ruble-based gas payment mechanism, among others, have helped the economy to stabilize, and even allowed the ruble to rise to a four-year high against the dollar on Friday.

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