March 31, 2023

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Russia seeks to eliminate dollar “complexity” and plan to nationalize foreign-owned factories

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Russia is working hard to free itself from the “complexity” of the dollar and its control over its economy and financial markets as it embarks on drastic measures to test the real devaluation of the US dollar to the ground. It is time for Washington to impose tougher sanctions on Moscow following the war on Ukraine.

Russia’s foreign intelligence service has denied the allegations in a statement issued Friday stating “Similar, baseless allegations concerning Russia’s intelligence have been made more than once.

Russia’s efforts over the years seem to have contributed to the release of the US dollar from control of its economy and financial markets, and to the mitigation of sanctions imposed on Moscow by the US and its allies.

Russia reduced its dollar reserves to just 16 percent of central bank reserves by 2021, down from more than 40 percent four years ago.
This means a significant reduction in its stake in US Treasuries, a reduction of about 98% in ownership from its peak in 2010, and the removal of dollar assets from sovereign wealth funds.

In addition, a key member of Russia’s ruling party recommended the nationalization of factories owned by foreign companies that had stopped their operations in the country due to what the Kremlin called a special military operation in Ukraine.
Several foreign companies, including Ford and Nike, have announced the temporary closure of their stores and factories in Russia in order to pressure the Kremlin to halt its invasion of Ukraine and to disrupt their supply chains.
In a statement on the United Russia party’s website on Monday evening, Andrei Durchak, secretary general of the ruling party’s General Assembly, called the closure of these institutions a “war” against Russia’s citizens.
The report said privately owned Finnish food companies Vaser, Valeo and Poleg were the latest to close their operations in Russia.

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“During a special operation in Ukraine, the United Russia (Party) proposes to nationalize the factories of companies leaving Russia and stopping production,” Dorsak said.

“This is a very violent act, but we will not tolerate backlash. We will protect our people. This is a real war, not against Russia as a whole, but against our own citizens,” he added.

“We will take strict retaliation in accordance with the laws of war,” Dork said.

Poleg’s CEO told Reuters that it would not change his company’s plans to leave Russia. Fatser and Valeo did not want to comment when contacted by Reuters.

Fasser, which makes chocolate, bread and pastries, owns three bakeries in St. Petersburg and one bakery in Moscow, employing about 2,300 people.

Value has a cheese factory and employs 400 people in Russia, and Poleg employs 200 people in a coffee roaster and country.

Finland, a non-NATO country that shares a border with Russia, last week agreed to enhance security ties with the United States, which has been watching Russia’s aggression against Ukraine.