Press review: Anti-Belarus sanctions could harm Russia and Bitcoin crackdown crashes price / News / News agency Inforos
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Press review: Anti-Belarus sanctions could harm Russia and Bitcoin crackdown crashes price

Press review: Anti-Belarus sanctions could harm Russia and Bitcoin crackdown crashes price

Top stories from the Russian press on Wednesday, June 23rd, prepared by TASS

Nezavisimaya Gazeta: Anti-Belarusian sanctions likely to harm Russia

Russia will be significantly harmed by the EU’s sectoral sanctions against Belarus, European politicians cited by Nezavisimaya Gazeta note. In the case of an EU boycott, Belarus may lose up to 30% of its export revenue, which totaled approximately $32 bln before the pandemic. Minsk is likely to be harmed the most if the EU bans exports of Belarusian fertilizer through European ports.

Lithuanian Foreign Minister Gabrielius Landsbergis noted that Russia would be significantly affected by EU sanctions against Lukashenko’s government. Only Russia can refinance the losses of Belarus, so by introducing sanctions against Minsk, the EU puts part of the pressure on Russia, which has the ability to influence Belarus, the minister explained.

The EU announced that it is planning to introduce sectoral sanctions against Belarus after the emergency landing of a Ryanair plane in Minsk on May 23 and the subsequent arrest of Belarusian opposition member Roman Protasevich, who was a passenger on the flight.

Belaruskali, one of the largest producers of fertilizers in the world, might be one of the companies targeted by the sanctions. It transports its products through the Port of Klaipeda in Lithuania, the newspaper reports. "Before the pandemic, the revenue of Belaruskali reached about $2 bln. About 90% of its products go through Klaipeda. It will be practically impossible to replace this route with the aid of Russian ports and railways," Belarusian political analyst Dmitry Bolkunets explained, adding that it is necessary to wait for the final decision on the sanctions regime. So far, about 20-30% of Belarusian exports are under the threat of sanctions, the expert suggested. Before the pandemic, Belarus’ exports reached $32 bln, so as a result of EU sanctions the Lukashenko government risks losing up to $10 bln.

There is also a threat of devaluation of the Belarusian ruble, which may become real in about five to nine months. "Russia isn’t interested in the Belarusian economy crashing. However, direct financial aid is complicated by legal issues tied to the legitimacy of the regime. According to the data in my possession, the Russian Finance Ministry may refuse to purchase new Belarusian Eurobonds," Bolkunets said.

Meanwhile, Lukashenko’s reaction to the new European sanctions can be very unpredictable. According to earlier reports by Nezavisimaya Gazeta, the German government allows the possibility of Belarus halting the transit of oil and gas to Europe through its territory. However, Vladimir Evseev, an expert with the CIS Institute, thinks that Moscow may convince Lukashenko not to hinder the transportation of Russian energy resources to Europe.

Kommersant: Russia records election interference attempts from NATO states

Russian lawmakers and head of the Russian Central Election Commission Ella Pamfilova have discussed possible ways to fight foreign interference attempts in the upcoming Russian parliamentary election, planned for September 19, 2021. The participants of the meeting assured reporters that they had collected the data about cases of election interference and their organizers, however, they are unable to provide any details for security reasons. An expert quizzed by Kommersant thinks that underlying the claims of election meddling is the desire of the Russian government to shift responsibility for election results, however, escalating tensions can cause irritation among some voters and raise the level of protest votes.

On Tuesday, members of the Election Commission met with Russian MPs and senators tasked with combating foreign interference. The commission’s head Ella Pamfilova confirmed that for the last six months, there have been attacks on its website. The attacks have been carried out from a number of states, but the majority of them originate in the US and the UK.

"The countries that Ella Alexandrovna [Pamfilova] mentioned are allocating a lot of money, along with other NATO member states," Chairman of the Russian State Duma (lower house of parliament) Commission on Foreign Interference in Russia’s Internal Affairs Vasily Piskarev said.

Igor Borisov, a member of the Central Election Commission, told Kommersant that during the meeting, its participants discussed working with the youth, which, according to him, "is taken over by [Russia’s] Western partners through various digital platforms via games, encouraging them to take part in protests".

Political analyst Alexander Pozhalov has not ruled out that the numerous statements made by Russian officials on foreign interference have a bureaucratic agenda. "The election organizers are warning beforehand that any expression of dissatisfaction with the way the game is played during the September election will be considered as instigated from abroad. In this way, they are absolving their responsibility before the country’s leadership for any possible conflicts around the election and the transparency of an online vote, or for the low vote count of the government in certain major cities," the expert told the paper. Meanwhile, voters do not consider foreign interference an issue of primary concern due to personal problems and the third wave of the pandemic, he said. "If propaganda uses the foreign interference thesis too much, it may even harm the situation and cause a spike in protest votes in major cities".

Nezavisimaya Gazeta: Venezuela blames US for its low vaccination rate

Venezuelan Foreign Minister Jorge Arreaza arrived in Moscow on Tuesday on a visit that will last several days. One of the key matters on the agenda of the talks is Russia’s aid to Venezuela in the fight against the pandemic, namely the supply of vaccine doses, Nezavisimaya Gazeta reports. Venezuela has one of the lowest vaccination rates in the world due to the catastrophic lack of vaccine doses.

Two days before Arreaza’s visit to Moscow, Venezuelan President Nicolas Maduro gave an interview to Bloomberg, in which he said that the US government rejected the suggestion of Caracas to lift or ease the sanctions against Venezuela. Maduro is trying to unfreeze the accounts of Venezuelan state companies and use their funds to purchase vaccines.

Meanwhile, Venezuela reports a shortage in COVID-19 vaccine doses. Medicos Unidos Venezuela, the country’s association of medics, is reporting issues with access to the second dose of the vaccine, with the interval between the first and second doses coming up to 90 days instead of the usual 21. Venezuela only receives vaccines from Russia and China (the Sputnik V and Sinopharm jabs respectively). According to Venezuelan health authorities, only 0.8% of the population were vaccinated against COVID-19, a record low figure even for South America, where the vaccination effort has generally been rather slow.

Director of the St. Petersburg State University Ibero-American Studies Center Viktor Jeifets told Nezavisimaya Gazeta that the Venezuelan health system is in a terrible condition. "It is a gift from God that there are so few COVID-19 cases in the country," he said. "According to the Venezuelan Health Ministry, the country with a population of over 28 mln has recorded just 260,000 COVID-19 cases, and 3,000 patients have died. However, we should note that the accuracy of this data is questioned, namely by Medicos Unidos Venezuela. The problem that they see is not the underestimation of case figures, but the low quality of medical statistical services".

Jeifets does not rule out that Arreaza’s visit to Moscow is due to Venezuela’s goal to purchase additional vaccine doses from Moscow. The expert notes that although Venezuelans get Russia’s Sputnik V at a discounted rate, it is not free, so Maduro will need to buy it on credit. "Another thing is that the Venezuelan government has so much credit that it is unclear how they will pay it off," he said.

Izvestia: Diplomat mulls whether Ukraine will officially withdraw from CIS

Ukraine can leave the Commonwealth of Independent States only if it wants to do this itself, Izvestia reports, citing Chairman of the CIS Executive Committee Sergey Lebedev, who informed the paper that although Kiev had failed to pay its membership dues for over five years, CIS states did not plan to exclude Ukraine from the organization. Although Ukraine has refused to participate in many of the commonwealth’s formats, it is still involved in some of them, the diplomat pointed out.

Despite the fact that Kiev has not participated in CIS statutory bodies for the past three years, it is still de jure considered a CIS member state. When asked whether Ukraine has officially refused further participation in the CIS, Lebedev answered in the negative. "The non-payment of dues can serve as a pretext to exclude a state from the CIS, but we don’t want to do that. We discussed this issue at the CIS, and its members think that it wouldn’t be right. Ukraine is our geographical neighbor, it was an active member of the commonwealth, and we still hope that at some point, its relations with the CIS will stabilize," he explained.

The Ukrainian Foreign Ministry did not respond to the newspaper’s request for comment regarding Kiev’s plans to pull out from the CIS, and the level of its current participation in the organization.

According to Russian politicians, Ukraine has de facto stopped being a CIS member a while ago.

"As for its de jure status, this is the Ukrainian style - to loudly announce its withdrawal without doing anything when it comes to practical procedures," Russian lawmaker Konstantin Zatulin told Izvestia. "If there is a goal, it comes down to one thing: they don’t want to demonstrate its attitude to other CIS states, with whom they still maintain bilateral ties, unlike with Russia. They do this so that we cannot say that they are breaking off ties not just with Russia, but with the entire [CIS] space," the Russian MP said.

Kommersant: Bitcoin drops as China cracks down on cryptocurrencies

On June 22, Bitcoin sank below $30,000 for the first time since January, losing over 20% in a week. As a result of the 26-35% drop in prices of other cryptocurrencies, the crypto market capitalization shrunk by nearly $500 bln. The low figures can be explained by China’s crackdown on cryptocurrencies and its ban on mining. Experts quizzed by Kommersant think that Bitcoin may drop further to $20-25,000 in the near future, however, the low prices may attract new investors.

On June 22, Bitcoin reached the lowest point since January 22, trading at $28,800, 11.6% lower than the previous day. However, the cryptocurrency managed to recover a little, and by the end of the day, its price stabilized at about $31,400. Even considering this recovery, Bitcoin has lost over 21% in a week, going back to its February figures.

Other cryptocurrencies recorded an even higher drop than Bitcoin: for example, Litecoin fell by 32% in a week, Ripple went down by 35%. The second most popular cryptocurrency, Ethereum, reached around $1,850 at the end of the day, which is 26% lower than last week’s figures.

The total capitalization of all virtual currencies dropped by nearly $500 bln in a week, reaching $1.72 trln. This is about 30% less than the record low documented in early May.

The prices of cryptocurrencies have been affected by China’s crackdown on the industry. Last week, it was reported that the government of the Sichuan province, a major cryptocurrency mining center, halted the electric supply of mining companies. According to researchers, over 60% of all Bitcoin is mined in China.

"China’s actions regarding cryptocurrencies and miners show that the government is resolved to lower the popularity of digital actives out of the control of the state," Head of Data Analytics at CEX.IO Yuriy Mazur told the paper. "In this way, China is paving the way for its own digital currency of the Central Bank, the digital yuan, which is planned to be launched in 2022," he explained.

According to Mazur, it is possible that Bitcoin will drop further to reach $25,000 due to technical factors and the pressure of China and the US. However, analysts doubt that the fall will last for a long time, as there is still a great deal of interest in cryptocurrency.

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