The frozen Russian assets should be used to rebuild the destroyed infrastructure by transferring these funds to the right Western companies, bypassing the Ukrainian leadership. And these companies will reap their rewards.
Ostap Bender [a resourceful swindle and the main character of satirical novels by Soviet authors Ilf and Petrov – translator’s note] knew 400 relatively legal ways of taking money from the population. All of them implied some kind of deception, where the victim would voluntarily put his hard-earned money into the hands of swindlers. European bureaucrats seem to have invented another moderately elegant way of depriving Russia of its foreign assets without making this look like commonplace theft.
How? Very simple: these assets must be confiscated under the pretext of helping Ukraine. According to various estimates, $500-750 billion will be needed to rebuild the Ukrainian infrastructure destroyed by the hostilities.
Recall that Europe and the USA have “frozen” more than $300 billion of the Russian Central Bank’s gold and foreign currency assets alone. And then there is Russian state property, worth billions of dollars, plus the property of Russian citizens, including the oligarchs, worth tens of billions more. All in all, this is the amount of money that the Western “elites” want to get their hands on. Especially since Western elites are forced to spend huge sums to compensate for the devastating consequences of the sanctions they themselves have imposed on Russia. So they have long been awaiting the opportunity to take all this wealth. After all, the cunning Western warmongers imposed sanctions not to pay for them themselves, but for something quite different!
There is a natural need to expropriate and spend the “frozen” assets and in this way let Russia pay all the price – à la guerre comme à la guerre. But it is not that easy to implement this brilliant plan: the word “frozen” means that the assets under sanctions cannot be used either by legal owners or by “sanctioned” persons. At the same time, it is becoming more and more difficult for Europe to bear the costs of the imposed sanctions every day, and if they are lifted, then it will turn out that Europe will incur the losses, while Russia remains the winner.
But it will not be easy to take away and divide the frozen funds. The European “Robin Hoods” are well aware of that. First and foremost, this looks like pure theft, robbery, and expropriation. And, secondly, even if the expropriation is ennobled by noble intentions to help Ukraine, then one has to transfer the stolen assets to Ukraine. Ukraine will become the main beneficiary in this case, and Europe will get shame and reputational costs.
The long-term consequences of such a step will outweigh any possible gains. The international community’s confidence in the Western legal and financial system would be irreversibly undermined. The number of those who would like to keep their assets or do business in Europe will be sharply diminished. Of course, China, which has made huge investments in the European logistics system both directly and through proxy firms, will be the most worried. In this case, the losses will be in trillions of dollars.
In mid-April, when the West adopted sanctions against Russia package by package, China’s largest oil corporation CNOOC said it intended to leave the United States, Canada and UK, arguing that there was a risk of falling under Western sanctions. According to Reuters, at that time, CNOOC management faced resistance when working in the West. In particular, the company’s top managers were banned from entering the US territory, depriving them of the opportunity to inspect their assets locally.
And this is just the first swallow. The cautious Chinese decided not to risk and sell the assets at a bargain price while they can. China has very good places to put its money besides Europe and North America: Latin America, Africa and the Middle East. Now let’s imagine what will happen when the Third World countries decided that it’s better not to do business with Europeans and start a massive sell-off of assets. It will be a collapse akin to the Great Depression.
By the way, Swiss President Ignazio Cassis has already warned about that. In his opinion, the seizure of assets can create a precedent that undermines the foundations of the entire liberal world order.
“The right of ownership, the right of property is a fundamental right… You have to ensure the citizens are protected against the power of the state. This is what we call liberal democracies. … now we can take a decision, which is perfect for the situation in Ukraine, but we create the possibility to take the same decision in many other possibilities and you give much more power to the states, away from the citizen,” he explained.
In his opinion, the situation with the Russian property should not become a reason for revising the European jurisdiction. The concern of Swiss authorities is understandable because they will be the first to suffer from the capital outflow.
However, the Canadian authorities have already adopted a law on the confiscation of Russian assets. It should be noted that this micro-scale scheme was preliminarily tested by the Justin Trudeau government during the truckers’ strike in February 2022. The first bell rang then, even before the start of the special operation in Ukraine, and the Chinese heard it.
However, now both the scale of expropriation and its possible consequences are completely different. The West faces two tasks. The first is to provide information support for confiscating Russian assets on its territory, so that it looks at least partly decent – saying that the Western countries are helping poor Ukraine as good as they can, even if it is at someone else’s expense. And the second is to give the confiscated assets to Ukraine in such a way that they eventually end up in the pockets of the West. Ideally, they should not be given to the Ukrainians at all, because then one will not see this money at all.
Europe is still hesitating with the first point, but a solution for the second point has already been found. This and the Canadian precedent give confidence that the first point will also be implemented sooner or later. Otherwise, why make a fuss of help for Ukraine?
The scheme is simple: the European countries divided Ukraine, choosing regions they will help to rebuild. And this was done without waiting for the end of hostilities!
Poland, for example, got the Kharkov region, where the fighting is still going on. France got the Kiev and Chernigov regions, where there is also a high risk of renewed fighting. It is clear that no one is going to allocate money from the European budget for this. The European population, overtaken by the crisis, will not understand or accept such generosity toward Ukrainians. For this reason, programs to help Ukrainian refugees are being curtailed across Europe. This means that external sources of funding are needed, and frozen Russian assets are an ideal option.
Now it’s just a matter of time before the assets confiscated from Russia can be used to rebuild the destroyed infrastructure by transferring these funds directly to carefully selected Western companies, bypassing the Ukrainian leadership. It is not important whether these companies will actually carry out restoration work on Ukrainian territory or whether it will be formalized on paper and then written off as force majeure (“the Russians destroyed everything again”). The main thing is that the money will be transferred from the Russian pocket to the Western pocket in full, without any “commissions” to the Ukrainian leadership. Naturally, the Western reconstruction companies will be affiliated with specific individuals of the Eurobureaucracy, who will get their “little revenues.” In fact, that’s what the pragmatic Germans and French started it all for.
And the Ukrainians will be left in debt for arms and financial aid supplied by the West, but that is another story.
Source: Rossa Primavera News Agency