RT quoted Russian Finance Minister Anton Siluanov as saying on February 16 that possible Western sanctions against Russia could lead to market volatility, but the country is likely to endure sanctions thanks to its abundant reserves.
Sanctions on Russian banks will be "difficult to bear" but the government will ensure that all deposits in banks and all transactions, including in foreign currency, are guaranteed, Siluanov said.
thank God, we have enough foreign exchange liquidity and enough foreign exchange reserves. They say we have a financial shield in the form of gold and foreign exchange reserves, budget surpluses and budget rules, low debt, Siluanov told reporters.
The minister noted that if the new sanctions target Russian energy companies, Russia will be ready to redirect its supply to other markets.
The statement comes as US and European officials are finalizing a package of sanctions against Russia. Western leaders have been saying for months that Russia may be planning to attack neighboring Ukraine, an accusation Moscow has repeatedly denied. Washington and its allies have said they could impose major economic sanctions on Russia if it attacks Ukraine and is reportedly considering cutting off the Russian banking system from the international payment mechanism SWIFT.
Minister Siluanov said that Russia could switch to other financial systems if it is cut off from SWIFT. He added that the potential limitations to buying Russian debt would be " hard to bear but not deadly" for a country with nearly $635 billion in gold and foreign exchange reserves as of early February 2022.
On the issue of Ukraine, the US and the EU have previously imposed sanctions on Russian banks and companies. Over the past seven years, the Russian government and central banks have reduced their share of US dollar reserves, moved assets out of the US and sold a smaller portion of their debts to foreigners.
Russia has been reshaping its international holding ratio, shifting to gold and other currencies. International rating agencies have previously said that Russia's financial reserves will allow the country to cope with the negative impacts of sanctions.
As of February 2022, Russia's foreign exchange reserves reached about 634 billion USD, the world's fourth largest foreign exchange reserve. Of these, the Euro accounts for 33%, gold accounts for 23%, the USD accounts for 22%, and the Chinese yuan accounts for about 12%.
