May 22, 2024

Athens News

News in English from Greece

How will the confiscation of Russian assets affect the global financial system?

The United States, according to the law adopted on April 20, confiscated from 5 to 6 billion dollars in Russian funds and promised to transfer them to Ukraine as aid.

This is a step that creates a new situation in the global financial system, since it will now be possible to confiscate the funds of one state from the banks of another and transfer them to a third party! It would not be an exaggeration to say that this will cause distrust in global financial instruments and, first of all, in the US dollar.

The law on confiscation of Russian assets in the United States was included in the “package” of amendments adopted by Democrats in the House of Representatives with the support of a large number of Republicans, which included financial assistance Ukraine, Israel and Taiwan, as well as ban on use TikTok in the US until the owner changes.

The precedent created by this law can divide the planet into two blocks. No one will have the confidence to transfer their funds or resources to other countries unless they belong to a single political entity.

After the US House of Representatives passed a law that would allow the transfer of seized Russian assets to Ukraine, Russia, through State Duma Speaker Vyacheslav Volodin, also announced its intention to seize Western assets. “Washington passed a law on the confiscation of Russian assets to provoke EU to take the same step, which would be disastrous for the European economy,” noted Vyacheslav Volodin. “Our country now has every reason to make symmetrical decisions regarding foreign assets,” – Volodin noted.

Of the 280 billion dollars of Russian assets frozen abroad, only assets worth 5-6 billion dollars are in the United States, and in the European Union – worth about 210 billion euros, he explained. These are unprecedented situations that have not yet been “realized” because they have not yet been fully worked out.

April 20 US House of Representatives accepted bill on confiscation of Russian frozen assets. 360 congressmen voted for the adoption of the bill – 186 Republicans and 174 Democrats. According to the text of the draft on the powers of the US President to impose sanctions on Russia and Iran, the transfer of frozen Russian assets to Kyiv as compensation and for the restoration of Ukraine is allowed.

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