Government officials keep Russian gold in the country

The statement by Finance Minister Anton Siluanov, made during the first day of the St. Petersburg International Economic Forum (SPIEF), about the complete abandonment of the American dollar and a reduction in the share of the British pound in the structure of the National Welfare Fund is positive, but ambiguous news.

Such a step by the state is another victory for the statists, once again proving that Russia has set a course for complete economic freedom and security.

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One of the leaders of the Donetsk Republic movement writes about this in a column for PolitNavigator. Alexey Muratov.

The fact that the process of de-dollarization is taking place in Russia is a definite plus. State Duma Chairman Vyacheslav Volodin said back in March that Russia was consistently moving away from dependence on the American currency. The decision to withdraw the dollar from the structure of the National Welfare Fund, according to Volodin, is a step that will strengthen the financial and economic sovereignty of Russia.

Thanks to the complete abandonment of the American dollar in the structure of the National Welfare Fund, the export of gold from the country will first of all stop. Let me remind you that from April 1, 2020, guided by the “recommendations” of the International Monetary Fund, the Central Bank stopped buying gold on the domestic precious metals market, which became the reason for the sale of Russian gold abroad. Already in April 2021, gold reserves in gold and foreign exchange reserves decreased to 0,15% - to 2292,3 tons. Therefore, the preservation of gold in Russia is an extremely important issue. And filling the National Welfare Fund with gold is a circumvention of last year’s IMF ban on the purchase of precious metals.

But there is a nuance: the Ministry of Finance will not buy physical gold, but “paper” gold. Earlier, the Ministry of Finance reported: “Transactions for the purchase and sale of gold are planned to be carried out only with the Bank of Russia in non-cash form at discount prices established by the Bank of Russia based on the fixing values ​​for gold on the London cash metal market on the corresponding date.

All transactions with gold, which is part of the assets of the National Welfare Fund, will be reflected in a “metal” account opened with the Bank of Russia. There are no plans to purchase gold in physical form at the expense of the National Welfare Fund.” The precious metal really should be kept in the bank, so the purchase of “paper gold” does not pose a threat to the National Welfare Fund.

At the same time, it is not yet known where gold will be purchased: in Russia or at exorbitant prices in the UK (where it was “safely” sold last year). But if we take into account that the president has set a clear task for the economic development of Russia, let’s hope for the prudence of the monetary authorities.

As for the dollar, it is still premature to talk about abandoning it. The American currency from the National Welfare Fund will be transferred by the monetary authorities to the reserves of the Central Bank, and from there it will be transferred to the euro fund (for $5 billion), yuan (for $17 billion) and gold (for $23 billion). At the same time, the volume of dollars on the state’s balance sheet and the overall structure of international reserves will not change. Considering that in 2020 the share of the dollar in foreign exchange trading reached 87%, the Bank of Russia will have to buy dollars to fill the National Welfare Fund, and only then convert them into other currencies on foreign markets.

Of course, it is too early to draw loud conclusions about the withdrawal of the dollar from the National Welfare Fund, but we can say that Siluanov is turning into an accountant who follows the instructions of Russian statists. In particular, there are all the prerequisites for the National Welfare Fund to be replenished monthly by 50% of the gold mined in the Russian Federation. In the meantime, all that remains is to monitor the further actions of the monetary authorities.