Lavrov says Western sanctions against Russia’s FX reserves were unexpected

23 March, 07:41 PM
Russian Foreign Minister Sergey Lavrov (Photo:Russian Foreign Ministry/Handout via REUTERS)

Russian Foreign Minister Sergey Lavrov (Photo:Russian Foreign Ministry/Handout via REUTERS)

The sanctions imposed by the West on Russian central bank reserves came as a surprise to Moscow, Russian Foreign Minister Sergey Lavrov has said, according to a report in Russian newspaper Kommersant.

After Russia invaded Ukraine on Feb. 24, Western countries introduced a set of sanctions against the Russian central bank. Lavrov said nobody really expected this in Russia.

With reserves of over $500 billion, Russia’s public finance system was more than sustainable prior to invasion. However, most of these assets were deposited with the western central banks, including the United States Federal Reserve System.

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Lavrov made a statement on central bank sanctions during a speech at Moscow State Institute for the Foreign Affairs on March 23, Kommersant reported.

Kommersant’s political coverage of Russia’s war against Ukraine includes quoting Vladimir Putin to the degree that might be not considered a fair and balanced reporting, by the BBC ethical standards.

By presented estimates, around $300 billion of Russia’s reserves are frozen.

Among the countries sanctioning Russian central bank reserves was France, with a bilateral mechanism that affected EUR 22 billion of Russian reserves.

Besides blocking the Russian central bank’s reserves, the EU blocked access of seven Russian banks to SWIFT, the international banking payment systems. The list of banks blocked included VTB – a state-owned Russian bank, which has the second largest amount of assets in the Russian banking system.

According to media reports, a group of U.S. senators, in collaboration with the U.S. Treasury Department a preparing a new wave of sanctions to block Russia’s gold holdings, worth approximately $132 billion.

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