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Abstract
In addition to the factors already negatively affecting the Russian economy (slowing growth, high inflation, etc.), there are now the external constraints resulting from Western sanctions. A new round of U.S. and EU sanctions necessitates the further enhancement of the internal market and national monetary policy in order to ensure continued economic development. Since many of the current sanctions relate to access to financial markets (borrowing, securities offerings, etc.), it is imperative to galvanize internal financial mechanisms to compensate for the reduction of external resources. This will require a significant adjustment of fiscal and monetary policy.
Notes
English translation © 2016 Taylor & Francis Group, LLC, from the Russian text © 2014 “Voprosy ekonomiki.” “Kakaia ekonomicheskaia politika nuzhna Rossii v usloviiakh sanktsii?” Voprosy ekonomiki, 2014, no. 12, pp. 37–53. Mikhail V. Ershov is director of finance research at the Institute for Energy and Finance (Moscow) and a professor at Moscow Financial University. Translated by Peter Golub.
1. Naturally, taking into account the multiplicity of factors that affect economic growth.
2. The Central Bank of the Russian Federation Decree no. 367-Y, September 23, 1998. This measure significantly limited the banks' nontransactional demand for foreign currency (other than for their clients' foreign transactions, exchange office operations, and bank card operations). In fact, at the end of the trading day, currency market participants could not have more foreign currency than they began with (i.e., if the currency was not related to servicing foreign contracts, but was acquired as an insurance asset or for speculative purposes).
3. World Gold Council, Telegraph, November 13, 2014.