Putin plans to get around sanctions with the help of western banks
Russia is planning to evade the European and US sanctions that were placed against them two years ago. Their plan is to allow the Kremlin to release and make available a 3-billion-dollar loan with a 10-year maturity term. Russia plans to achieve this with the help of Chinese, European and US banks.
This was reported by the Insomi news website with reference to German newspaper, Die Welt.
“Putin draws his net around the giants of Wall Street,” the newspaper reported. The newspaper also noted that if the loan plan succeeds, it will be a blow for the West.
“It will be a political failure for the EU and the US,” Die Welt continued. The newspaper also noted that it is a very risky move for Russia and is based on an “all or nothing” strategy.
If Russia succeeds in this workaround, the sanctions imposed against them will become virtually meaningless. The West will also not be able to place any economic pressure on Russia.
These sanctions do not forbid banks to participate in the auctions of loans. Banks have the right to give Russia a loan as the sanctions are not imposed on the state itself, just on individual companies.
According to the newspaper, if Putin’s plan is successful, he can bring dollars into the country and then transfer these funds to sanctioned companies.
However, the US government has warned US banks against entering into loan agreements with Moscow.
Despite all of these warnings, many banks are contemplating supporting this Russian initiative from a purely business point of view.
The Finance Ministry in Moscow has emphasized that loans will be issued despite US warnings.