Russian President, Vladimir Putin (in front) and the world map (in the background). Photo: Hady Dbouq/Al Mayadeen.
By Janna Kadri – Mar 25, 2024
Moscow’s defiance of Western elements, particularly the economic sanctions and the military aid to Ukraine, has not only set an example for other nations to follow but also eroded the legitimacy of the West’s ideological supremacy.
On March 18, Vladimir Putin emerged as the winner of Russia’s presidential elections, marking his fifth term as President of Russia. This occurred despite complications. While it is common for Russia to be the target of cyber-attacks, this year has witnessed record levels of such breaches on the country’s electronic voting platform, with most attacks stemming from the US.
Putin’s landslide victory solicited positive reactions from many across the Global South. Leaders from multiple countries, including Iran, China, South Africa, Belarus, the DPRK, members of the Commonwealth of Independent States (CIS), and several Latin American nations have welcomed his reelection.
The Collective West, on its part, has been eerily silent about the win. A few exceptions surfaced on the X platform, with, for instance, President of the European Council Charles Michel reiterating the standard accusation that Russian elections are undemocratic. “No opposition. No freedom. No choice,” the tweet read. So much for being disgruntled. Nevertheless, the bloc has obvious reasons for displaying such dismay.
Ukraine war
Two years into the war in Ukraine, discussions on a potential peace deal involving the withdrawal of Russian troops in exchange for retaining territory have begun to pick up speed. The costs of this war were paramount for both the West and Russia, but particularly for the EU. The de-industrialization accompanying sanctions on Russia has resulted in disastrous outcomes for the Euro economy, pushing millions into financial insecurity, while the bloc grapples with efforts to restore economic growth.
More concerning is a decline in US support which has placed the EU in an awkward position. Although the White House recently unveiled a stopgap aid plan for Ukraine valued at $300 million, prior delays in aid delivery, fueled by congressional disputes over the border crisis, have left NATO allies questioning the US’s commitment to the conflict.
During a recent address before Western leaders at a Ukraine-focused event, French President Emmanuel Macron echoed these concerns by questioning the wisdom of entrusting Europe’s future to the American electorate. “Should we entrust our future to the American electorate? My answer is no. Let’s not wait for the outcome,” he said.
When Macron mentioned the possibility of deploying NATO forces in Ukraine, some perceived his statement as controversial or bold, only for reports to later emerge and reveal that NATO forces are already in Ukraine. But given the fact that the Ukraine war is not considered a de facto war from the Russian perspective, one can only speculate about the potential scale of a full-fledged conflict with the NATO alliance.
Western Hegemony
From a Global South perspective, the true achievement lies in Putin’s defiance of NATO. It lies in challenging the forces that for years have kept the masses in a state of social, ideological, and historical paralysis. Where the West sees aggression and destabilization, the South sees retribution. The fact is that Russia was deceived by the West over the Minsk agreement.
If one finds it peculiar that the Ukraine war garners very little to no support in the South, the case is far from mere coincidence. The extensive legacy of the West spanning hundreds of years serves as a testament to the destructive nature of its foreign policy. In the Global South, where the collective memory of millions who perished under the weight of imperialism and military aggression remains vivid and lucid, the realities at play are crystal clear.
The Ukraine war is not merely a war for the preservation of Russia’s national security but also a war for the thousands of mothers who gave birth to malformed babies due to contamination from NATO’s use of depleted uranium ammunition in Iraq, Libya, Afghanistan and Serbia, a type of shell which has been shown to increase cancer rates and other forms of disease in targeted countries. It is a war for those thousands of people who succumbed to their illnesses as a result of sanctions that prevented the entry of crucial medical aid. It is also a war for the comrades in Iran, Indonesia, and several countries across Latin America and Africa who died resisting injustice and oppression at the hands of imperialist stooges.
Though it may be the case that Ukraine emerged victorious in the propaganda game, that victory is primarily recognized in the West. Russia, on the other hand, is emerging not only as a victor in the military conflict but also as a trailblazer in shaping a new world order.
Moscow’s defiance of Western elements, particularly the economic sanctions and the military aid to Ukraine, has not only set an example for other nations to follow but also eroded the legitimacy of the West’s ideological supremacy. Russian economic resilience has effectively demonstrated that sanctions can be mitigated and that capital control measures, along with a basket-based currency, can be far more effective than the neoliberal charlatans preached by the West.
With the establishment of new transaction mechanisms and the ingenuity that accompanies sanction evasion, the fear of sanctions no longer seems to weigh as heavily as it once did.
The Ukraine war marks a pivotal moment in history as it signals the transition from a unipolar world to a multipolar world order. The gradual formation of an alternative financial market by the BRICS organization further compounds these developments. Nothing can better convey the end of US-EU financial hegemony than the sense of panic surrounding the use of Russia’s frozen assets.
Asset Seizure
Approximately $300 billion in Russian securities and cash have been frozen by the EU, G7 nations, and Australia since the start of the war — with the majority of funds held in the EU. While there was a belief that these funds should remain inaccessible to Russia unless it assists in Ukraine’s reconstruction, there was disagreement over the legality of outright asset seizure.
To resolve this dispute, Western leaders sought guidance from a team of international law experts and practitioners, who unanimously agreed in a joint letter issued in February that the seizure of assets is entirely legal, citing Russia’s ongoing special military operation in Ukraine.
Just a day after the joint letter, the International Monetary Fund (IMF) warned that plans to seize Russia’s assets could pose a significant threat to the global monetary system and entail unforeseen risks, which include “risks of litigation, risks of countermeasures, and risks to the international monetary system.” This implies that if the confiscation is carried out, it could push the Global South further away from reliance on the dollar.
Similar sentiments were echoed by Florian Philippot, the leader of the French Patriots party, who openly stated that the use of Russia’s frozen assets is “illegal and foolish,” noting that Russia possesses more Western assets, and cautioned that if the EU proceeds with seizing Russian assets, it could prompt Russia to retaliate in kind.
Other senior officials have expressed the pressing need for Brussels to establish an “emergency mechanism” in case the initiative to support Kiev through the use of Russian funds encounters unforeseen consequences. They warned that Euroclear Bank, which hold Russian funds and holds over €37 trillion in assets globally, could face liquidity issues if overwhelmed by a multitude of lawsuits.
The US, on its end, has voiced some uncertainties regarding the issue but has not displayed any signs of concern. At a recent press conference in Brazil, US Treasury Secretary Janet Yellen acknowledged that the West’s unfreezing of Russian assets is likely to pose a threat to global financial stability, but downplayed the significance of the matter.
Yellen further noted that the global economy lacks viable alternatives to the financial architecture centered around the dollar, euro, and yen, and underscored the necessity for collaborative efforts within the G7 to examine different approaches with regard to the use of Russian assets.
US Deputy Treasury Secretary Wally Adeyemo likewise rebuked such risks, stating that the strength of the US economy prevents it from being undermined by the implementation of sanctions.
Balancing Risks
Despite all odds, the EU eventually agreed to access Russian funds but opted only to tap into the windfall profits accrued from interests. Of the sum seized by Euroclear, which roughly accounts to €191 billion ($205 billion), the funds have accrued over €4.4 billion in interest over the past year. The bloc intends to use this money in order to purchase weapons for Ukraine.
The decision to utilize only the profits instead of the full amounts reflects genuine concerns regarding potential repercussions. These concerns extend beyond legal ramifications to include significant military implications.
Currently, Russia produces three times more artillery shells than both the EU and the US combined, and this occurs despite facing a barrage of sanctions. If Russia were to access Western funds in its Central Bank and allocate these resources to expand its military operations, it would inevitably result in a substantial shift in the balance of military power.
All in all, Putin has done a remarkable job at defending his country’s interests and national security. Not only have his contributions solidified his leadership within Russia, but they have also inspired the Global South towards new horizons. With that in mind, history has begun to shift in the right direction.
