Russia must take urgent measures to minimize the use of the dollar, as Joe Biden’s new US administration signals that it will increase sanctions, a senior diplomat said.
“We need to protect ourselves against the US financial and economic system to eliminate dependence on this toxic source of permanent hostile actions,” Deputy Foreign Minister Sergei Ryabkov said in an interview on Wednesday in Moscow. “We need to reduce the role of the dollar in any operation.”
Russia is preparing for the latest punitive US measures on nerve agent poisoning and the arrest of opposition leader Alexey Navalny. In a speech at the Munich security conference last week, Biden said that addressing “Russian recklessness and invasion of computer networks in the United States and across Europe and the world it has become essential to protect our collective security. “
The United States has imposed more than 90 rounds of sanctions in recent years against state banks and corporations, the oil and gas industry, top officials and world magnates and is likely to add more restrictive measures, said Ryabkov.
De-dollarization Drive
Russian President Vladimir Putin led a campaign for several years to reduce exposure to US assets, putting pressure on part of gold in central bank reserves above the dollar for the first time. Still, Russia depends on the US currency for much of its international trade, and foreign investors hold nearly a quarter of its government debt.
The Ministry of Foreign Affairs is not responsible for economic policy and Ryabkov did not elaborate on what measures can be taken to further reduce Russia’s dependence on the dollar.
Tensions with Russia’s Cold War rival have steadily grown and are now even worse than at the height of the communist era, said Ryabkov, who deals with US ties to the Foreign Ministry.
“There was never anything like it in terms of lack of trust, but also of mutual hostility,” said the diplomat. “Emotions are racing and we won’t see any improvement for a long, long time.”
He considered the US claims that sanctions would be relaxed if the Kremlin changed its policies “lying”.
The slowdown in relations accelerated after Russia’s annexation of Ukraine’s Crimea in 2014 and the alleged interference in the U.S. presidential election two years later. The Biden government has promised to take a tougher stance on Russia and is considering further sanctions to punish Moscow for a major cyber attack detected last year and the Navalny case. The Kremlin denies any role in anyone.