Russia has been under sanctions for more than three weeks after its botched invasion of Ukraine. Videos have emerged of desperate Russians jostling for packets of sugar, as products that seem like staples to many have become the latest battleground for a government bent on war.
Sanctions are there to force the Russian government to back down, or at least come to the negotiating table. There are would have made good progress in the talks between Russia and Ukraine last week, but big differences remain between the two sides.
Waiting for, the sanctions will keep biting and the bombs will keep falling. The sanctions work both ways, while the Russian population fights for an ever dwindling supply of goods, the nations that imposed the sanctions have their own problems. Rising oil, gas and electricity prices hurt wallets of those in the west. But these unintended consequences are just the tip of the iceberg of effects that reverberate around the world.
What are some of the sanctions Russia is subject to?
Until there, sanctions against Russia include the freezing of central bank assets, as well as the disconnection of Russian banks from vital components like Visa and Mastercard. This has left people unable to withdraw moneyand the run on the banks from the first week of the led to spiral inflation with persons unable to withdraw foreign currency.
However, there is not yet a complete ban on Russian oil and gas largely due to European dependence on these fuels to supply their countries. the The European Union bloc relies on importing 40% of its natural gas from Russia. Cutting this immediately would send already sky-high prices to unbelievable and intolerable levels.
The unprecedented sanctions and export controls that the United States and more than 30 countries have imposed on Russia are taking their toll.
-The ruble is worth less than a penny
-The Russian stock exchange is closed for the longest period in its history
-Russia’s credit rating is now “junk”
— The White House (@WhiteHouse) March 11, 2022
What this means in real terms is higher prices across Russia. According to Moscow todaya independent russian newspaperinflation has increased more than four percent in just four weeks. For comparison, the Central Bank of Russia aims to keep inflation below four percent each year. This target has already been and will continue to be exceeded.
There are no guarantee that the sanctions will have the intended effect. In the recent examples of Iran and Cuba, economies adjust to sanctions over time.
How will this affect the United States?
The repercussions of the Russian sanctions are felt above all in the price of energy. The United States has banned the import of Russian crude oil, cutting 7% of their imports last year in one fell swoop. If crude oil, and therefore gasoline, has a high price, then everything is affected. All trade and supply routes are at some point affected by the price of crude. The price of fuel continues to rise, despite the drop in the cost of oil last week, so it may not be the sanctions that are the only reason for the high prices.
Prior to the invasion, the United States experienced an annual inflation of more than 7 percent, the highest in 40 years. Sanctions exacerbated this, but did not cause it.
But as the cost of goods increases in the United States, this consequence pales in comparison to the effect on Ukrainians under shellingor for countries desperately dependent on Ukrainian and Russian exports to survive. There are about fifty countries that import more more than thirty percent of their wheat the two nations. Egypt, for example, imports 80% of its wheat; the very real prospect of not receiving such a wealth of food will force many to hunger, if not starvation.
“Global food chains demand global solidarity in times of crisis”, says Lama Fakihexecutive director for the Middle East and North Africa at Human Rights Watch. “Without concerted action to address food supply and accessibility, the conflict in Ukraine risks aggravating the global food crisisespecially in the Middle East and North Africa.