Gold exports bring in billions of dollars each year to Russian coffers – Serious effects on Putin’s military machine – Russian oligarchs will be hit even harder
Its great powers G7which seek to intensify pressures on Moscow Reacting to its invasion of Ukraine, they announced today, the first day of their summit in Germany, their intention to ban imports of Russian gold, which will be cut off from the important London market.
“Together, the G7 will announce that we will ban Russian gold, a major source of exports, which will deprive Russia of billions of dollars,” he said in a Twitter message. US President Joe Biden before the start of the summit of the Group of Seven most industrialized countries in the world in a tower in Bavaria, in southern Germany.
Pending a collective announcement at the end of the summit on Tuesday, Britain, the United States, Canada and Japan announced today the imposition of an embargo on gold imports recently exported to Russia, without focusing on what has already been sold.
“These measures will directly hit the Russian oligarchs and attack the heart of Putin’s war machine,” the British prime minister said in a statement. Boris Johnson
This ban is expected to take effect soon and will apply to newly mined or refined gold. It will not affect gold of Russian origin that was previously exported from Russia, Downing Street clarified.
“Putin is wasting his resources in this useless and barbaric war. He is feeding his ego to the detriment of the Ukrainian and Russian people,” Johnson said. with our allies. “
THE Russia is a major gold producer and its exports accounted for almost 15 billion euros in 2021, or 5% of the world market, according to London and Washington.
This precious metal is the second product that Russia exports after energy, which has already been targeted by the West, as they have already banned Russian oil and the Europeans are seeking to reduce their dependence on Russian gas.
The aim is to isolate Russia from the international financial system and to prevent the financing of the Russian war machine by paying Moscow billions for the import of resources.
The embargo on Russian gold “is an additional means of blocking links between the Russian economy and the financial system,” a senior US official explained.
The effects of sanctions “are accumulating over time and Russia’s ability to wage war will be diminished by the collective action taken by the G7,” he added.
90% of Russian gold exports go to the G7 countries and to a large extent to Britain, as London hosts the main financial center for the trade of raw materials, including metals.
The announced move would therefore have “a huge impact on Putin’s ability to raise funds,” the British government said. This would particularly hurt Russian elites who were able to buy gold “to try to circumvent Western sanctions,” he added.
Britain is among the Western countries that have imposed very harsh sanctions on Russia after its invasion of Ukraine, targeting the financial sector, oil, dozens of oligarchs. The British sanctions in Russia affect a total of more than 100 entities and 1,000 individuals.
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