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New US sanctions: An incentive for Russia’s development or a path to problems? Tuesday, 30 March 2021

New US sanctions: An incentive for Russia’s development or a path to problems?

Earlier, the United States completely banned the export and import of weapons against Russia. There are a few exceptions for aviation and space, but they will only be valid until 1 September.

"The entry into force of the new US sanctions will only make the process of excluding imports from our technological chains more intensive . The money used to pay for imports will remain in the country and will be used for the salaries of employees and the development of new technologies and production facilities," says the official statement of the Ministry of industry and trade of Russia.

Thus, the Ministry is carrying out measures for import substitution in the radio-electronic industry. For this purpose, such tools as subsidies, tax incentives, and stimulating demand for final products are used.

"Moreover, the radio-electronics market today is not only technology from the United States, it includes a number of available products from other countries," the Ministry’s press service added.

The programs developed by the Ministry of Industry and Trade of Russia together with the enterprises of the aviation industry for import substitution of foreign materials and components in the design of the latest Russian aircraft will completely eliminate the risks of the introduction of new sanctions, according to Moscow.

"The aircraft will become Russian by more than 98%. The newest MS-21 has already made its first flight with the Russian PD-14 engine, and the composite wing for this airliner has already been tested, " the ministry said.

They also noted that since 2014, when the sanctions pressure of the West on Russia began, the Ministry of Industry and Trade of Russia constantly evaluates various industries from the point of view of import substitution.

In turn, the press secretary of the President of Russia Dmitry Peskov said that the Kremlin considers the import substitution program implemented in Russia to be successful, stressing that "no country produces 100% of its own products."

"The program is successful. In the end, the goal of one hundred percent import substitution, including all the nuances of the food industry and so on, all additives-no country does this, " Peskov said.

"The food industry fully meets the needs of Russians. If we are already talking about some nuances, then yes, the import is certainly happening. It will happen. There has never been a task to stop food imports, " Peskov told reporters.

Peskov acknowledged that " any ban on supplies, of course, is not in the interests of citizens." "It is not in the interests of the citizens of the producer country, and not in the interests of the citizens of the recipient country," the Kremlin spokesman said.

At the same time, Moscow believes that the United States is unlikely to impose sanctions against the Russian national debt or restrict access to international payment systems, because this may also affect their interests, the head of the American Chamber of Commerce in Russia (AmCham), Alexis Rodzianko, told RIA Novosti.

"This topic, unfortunately, is raised again, and yesterday, within the framework of the Board of Directors of AmCham, among others, we discussed the possibility of applying such measures (restrictions on public debt, disconnecting the Russian Federation from SWIFT-ed.), “the head of the chamber shared.

"There were different opinions, but the prevailing opinion is that it is unlikely that the United States will apply sanctions that would impose restrictions on Russia’s national debt or on access to international payment systems. It is clear that this is a double-edged sword, " Rodzianko said.

The fact that the United States and the United Kingdom are considering the possibility of imposing more sanctions against Russia, aimed at sovereign debt and businessmen, was reported in early March by the Bloomberg news agency, citing sources.

Russian Finance Minister Anton Siluanov said in one interview that the Ministry will negotiate with the Central Bank of the Russia to provide banks with liquidity for the purchase of federal loan bonds in the event of sanctions on the Russian state debt.

In turn, in America, the possible impact of new sanctions against Russia is seen in a slightly different light. Many experts and analysts in the United States believe that the next sanctions package threatens serious problems for the Russian industry — primarily the defense industry.

The sanctions, which came into force on March 18, 2021 impose visa and financial measures against several high-ranking Russian officials, provide for the termination of financial assistance to the Russian Federation and prohibit the provision of US government loans.
They prohibit the export of weapons from the United States to Russia and from Russia to the United States. It also announced the termination of assistance to other countries in the purchase of weapons from Russia and, finally, significantly tightened the existing restrictions on the export of dual-use goods and technologies to the Russian Federation. An exception has so far been made for supplies intended for joint Russian-American space programs.

Dual-use goods and technologies can also be temporarily supplied for commercial space launches by Roscosmos until September 1, 2021, but in each case, the request for the purchase of a particular equipment will be considered separately. The RD-190 rocket engines were also not sanctioned. Russia must supply them to the United States by 2024.

Experts in Russia say that military cooperation with America has long had a symbolic content. However, Washington cites different statistics. Russia supplies USA weapons and other goods used in the military industry, in particular nuclear materials and isotopes, as well as other products. In total, in 2020, Russian military exports to the United States exceeded $ 1 billion. According to the latest published data of the US Department of Commerce for 2019, the volume of US military exports to Russia amounted to $5.8 billion.

According to American statistics, Russia was supplied with goods related to the non-proliferation of nuclear weapons, subject to agreements on small arms, as well as related to the fight against terrorism and combating crime.

As expected, the new American restrictions will greatly affect the Russian civil aircraft industry. The list of products prohibited for export in Russia includes aviation gas turbine engines, equipment related to rocket and torpedo launches, electronics and software, equipment for chemical production, navigation systems, components and parts intended for the space industry. Until now, the supply of such products has been allowed exclusively for civilian use.

It is still too early to say what the real impact of the new US sanctions on the Russian economy may be. Nevertheless, problems may arise for Russia. The question is: will the Russian government be able to meet these challenges as successfully as it has dealt with other similar obstacles in recent years?

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"Diario ilustrado". Una publicación electrónica independiente que apoya puntos de vista liberales, progresistas, Pro-europeos y Pro-empresariales. La publicación fue creada por un grupo de periodistas independientes en oposición a la línea mediática de Rupert Murdoch y publicaciones conservadoras y de derecha. Publicado en español