MOSCOW, March 9 – RIA Novosti. The possible imposition of sanctions on the Russian national debt will negatively affect non-residents, who will be forced to sell these securities, which in turn will allow Russian investors to buy them at a large discount, Vladimir Tikhomirov, chief economist at BCS Global Markets, commented to RIA Novosti on recent messages.
Bloomberg reported last week that the US and UK are considering more sanctions against Russia, targeting sovereign debt and businessmen.
According to Tikhomirov, the sanctions will have a more significant negative impact on foreign holders of Russian debt. “After all, it is easy to assume that if a ban on holding such debt is imposed, foreign investors will be forced to sell it. This will lead to a drop in the value of securities, which will allow the Ministry of Finance or Russian investors to buy it at a large discount,” the expert said.
As a result, instead of putting pressure on the Russian state, the sanctions will provide it with direct or indirect support, while the main losses, on the contrary, will be borne by the foreigners, the source said. He added that Russia does not have any dependence on foreign debt markets – the Ministry of Finance fully covers its needs at the expense of the domestic market.
Speaking about sanctions against businessmen, the expert noted that the effect could be significant. “However, here, too, not everything is clear: if such sanctions are imposed, the quotations of these companies' shares will fall, which may create good opportunities for other investors who are not affected by these sanctions, primarily domestic investors. Thus, these sanctions are again serious foreign investors will suffer, although there will certainly be an effect on the companies and businesses of the oligarchs, “he continued.
The expert believes that the introduction of these restrictions is unlikely, but the ongoing discussions about such a possibility often turn out to be a more effective instrument of pressure on Russia than the imposed sanctions. “Recently, literally, few days have passed when one of the Western officials or congressmen does not speak on tougher sanctions. This allows maintaining an increased country risk to Russia, which is reflected in investment flows and the ruble exchange rate,” he concluded.