Putin puts West on notice: Moscow can terminate exports and deals
Putin begins Russia’s bite-back over Ukraine sanctions
Gives wide powers to cut raw material, produce exports
Forbids transactions with sanctioned entities
Retaliatory moves could wreak chaos across markets
Who will be on sanctions lists will now be key
Putin, Russia’s paramount leader since 1999, signed a broad decree on Tuesday which forbade the export of products and raw materials to people and entities on a sanctions list that he instructed the government to draw up within 10 days.
The decree, which came into force with its publication, gives Moscow the power to sow chaos across markets as it could at any moment halt exports or tear up contracts with an entity or individual it has sanctioned.
Makes it worse for the Russian business climate. And that applies to everyone on earth, including Russians. Why would any Russian want to invest in Russia with such uncertainty? Capital flight is just going to get worse, or spare money is going to go into stores of value and not productive assets. There is no good that can come of this, for Russia. It simply isnt worthwhile to put up with such political risk premiums.
Not to mention cutting itself off from the best markets on Earth. It doesnt matter what you produce; the rarest thing in business under almost all circumstances are customers. Markets are more precious than any commodities.
I have seen several countries suffering from such self-destructive autarkic whims. The results are always bad, and even if a reform government takes over it can take decades to recover.