Blocked in the accounts of the Celestial Empire were Russia’s last unfrozen gold and foreign exchange reserves.
Having invested 17 percent of foreign exchange reserves in yuan, Russian authorities have admitted that it is impossible to withdraw funds from Chinese assets, The Moscow Times wrote on September 4.
Selling the yuan, in which more than $100 billion of international reserves were invested as of Jan. 1, requires a separate agreement with China. This was stated in the presentation of the Central Bank of the Russian Federation, prepared for a meeting with members of the government on the future fate of reserves and plans to fill them with “friendly” currencies.
According to a document cited by Bloomberg, the authorities are discussing the possibility of buying yuan and other “soft” currencies in the amount of 70 billion. At the same time, the Central Bank of the Russian Federation admitted that after the imposition of sanctions and a ban on transactions in dollars and euros, it is not easy to find assets for gold reserves.
It is relatively easy to invest in Chinese assets, but not withdraw. This requires permission from the Chinese authorities, and “it is very difficult to obtain it in a crisis,” wrote the Central Bank of the Russian Federation.
China and India are reducing their purchases of Russian oil
In Chinese “trap” is the last unfrozen reserve of Russia. Of the $640 billion the CBR had before the start of the massive invasion, about half fell under the first wave of Western sanctions. These are dollars, euros, Japanese yen, British pounds, as well as Australian and Canadian dollars.
The gold of the Central Bank of the Russian Federation – 2.3 thousand tons, which makes up the fifth largest gold reserve in the world – fell under separate US sanctions in April. And even if the bars are stored in Russia and cannot be arrested, it is almost impossible to sell them abroad secretly: Russian gold has characteristic impurities that will unambiguously indicate the country of origin of the metal .
Before the start of a full-scale war against Ukraine, the Central Bank of the Russian Federation, according to its annual report, held 105 billion dollars in yuan. Today the Chinese currency is trading at around 6.9 yuan per dollar and the price has fallen seven percent since February. This “cut” seven billion dollars from Russia’s gold reserves in the form of foreign exchange losses.
It was earlier reported that China has zeroed out investments in Russia through the One Belt – One Road global project. This happened for the first time since 2013. And the US State Department assessed the reduction of Chinese exports to Russia.
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.