Russia took a clever step last week to evade global sanctions, by attempting to peg its currency to gold.
Starting this week, the Russian central bank will pay a fixed price of 5,000 roubles ($52) per gram between March 28 and June 30, the bank said on Friday. This is below the current market value of around $68.
Economic sanctions have rarely worked in changing behaviour of governments. Sanctions have made things difficult for the population in Cuba, Iran, Venezuela, North Korea and countless others. But those governments are still in power. Economic sanctions will not topple the Putin regime either.
But Russia is rich in resources, resources that first world countries are dependent on. In response to escalating sanctions from the West for Russia’s invasion of Ukraine, Moscow said that “unfriendly” countries could be required to pay for Russian gas in rubles or gold.
Host: Victor Menasce