Countries around the world are responding to Russia’s incursion into Ukraine by imposing a series of sanctions, many of which focus on freezing the assets of some of Russia’s most powerful entities.
CTV News analyzed the financial data of 32 legal entities facing sanctions from Canada after Russia invaded Ukraine. To compare banks, the value of their total assets was considered to determine a bank’s financial strength. For non-banks, revenue or market capitalization was taken into consideration.
On February 22, 2022, Canada imposed the first round of sanctions, followed by a series of other sanctions covering 382 wealthy individuals and financiers and 32 Russian entities under the Regulations on special economic measures (Russia).
A total of 31 of the 32 entities have no physical presence in Canada. The Russian company with some presence in Canada, Alrosa, is the world’s largest diamond miner and public holding company operating through five mines — four of which are located in the Northwest Territories: Diavik , Ekati, Gahcho Kue, Snap Lake Mine; and one in Northern Ontario: Victor.
More than half (63%) of entities facing sanctions include the largest banks in Russia. Others on the list are giants in the aerospace, defense, mining and telecommunications sectors, with a strong presence in global markets. Examples on the list include the largest natural gas supplier to Europe and Turkey, Gazprom, and the world’s largest diamond miner, Alrosa, which accounts for 28% of diamond mining capacity. In the world.
The US, UK, Germany, Japan and Australia have also announced similar sanctions, including freezing the assets of Russian entities.
What sanctions does Canada impose on Russia?
Canada uses two forms of sanctions against Russia, including immobilizing its assets and restricting trade to and from Russia. The aim is to ban any foreign transactions through the Russian banking system and limit the country’s ability to import and export goods. On Saturday, US officials said additional steps were shaping up to bring the ruble into “free fall”.
This means cutting key Russian banks out of the SWIFT financial messaging system. SWIFT supports billions of dollars worth of daily financial transactions across more than 11,000 banks and other global financial institutions.
The impact of sanctions
Sanctions could create inflation in the Russian economy and limit the country’s cash flow. In 2014, before Russia annexed Crimea, a series of international sanctions and the drop in oil prices at the time led to the collapse of the Russian ruble and eventually the Russian financial crisis.
After the US, EU, UK and Canada blocked some Russian banks from the international payments system SWIFT on Saturday, the ruble fell about 30% against the dollar on Monday – making it worth less. one US cent.
However, following Western sanctions, Russia’s central bank said in a press release that Russian banks are highly resilient because each bank’s balance sheet is mainly (80%) ) in rubles. It should also be added that loans in foreign currencies are mainly granted to companies with Russian solvents.