The president’s ruble payment plan Vladimir Putin for him natural gas it is the prototype that the world’s largest country will extend to other major exports, because the West has determined the fall of the US dollar by freezing Russian assets, the Kremlin said.
The Russian economy is facing the most serious crisis since the collapse of the Soviet Union in 1991, after United States and its allies imposed crippling sanctions due to the invasion of Ukraine by Putin on February 24.
Putin’s main economic response so far has been the decree, on March 23, that exports of gas in Russian are paid in rubles, although the plan allows buyers to pay in the contracted currency, which is then exchanged for rubles by Gazprombank.
“It is the prototype of the system,” said the Kremlin spokesman, Dmitry Peskovto Russian state television Channel One on the system of payment in rubles for gas.
“I have no doubt that it will be extended to new groups of goods,” Peskov said. He did not give any deadline for that measure.
Peskov called the West’s decision to freeze $300 billion of central bank reserves a “theft” that would have already hastened a move away from reliance on the American dollar and the euro as currencies of world reserve.
The Kremlin, he said, wants a new system that will replace the contours of the financial architecture of Bretton Woods established by Western powers in 1944.
“It is obvious that – although it is currently a distant prospect – we will arrive at a new system, different from the Bretton Woods system,” Peskov said.
Western sanctions on Russia, he said, have “accelerated the erosion of confidence in the dollar and the euro.”
Putin has said that the “special military operation” in Ukraine is necessary because the United States was using it to threaten Russia and Moscow had to defend itself against persecution of Russian-speakers in Ukraine.
Ukraine has rejected Putin’s claims of persecution and says it is defending itself against unprovoked aggression.
Russian officials have repeatedly said that the West’s attempt to isolate one of the world’s largest producers of natural resources in the world is an irrational act that will raise prices for consumers and cause Europe and United States go into recession.
Russia has long been trying to reduce its dependence on the US currency, even though its main exports – oil, gas and metals – are priced in dollars on world markets. The dollar is by far the most traded currency in the world, followed by the euro, the yen and the pound sterling.