Moscow — Friday’s Russian Parliament has passed a law that makes it easier for the government to use the National Wealth Fund (NWF) to buy stocks and government bonds of Russian companies as a measure against the crisis.
Authorities looking for ways to support markets hit by Russia’s invasion of Ukraine and Western sanctions have funded NWF to buy Russian securities in a similar move to Russia’s 2014 annexation of Crimea. I am planning to use it.
The new law allows the use of rainy day funds to buy stocks and bonds even if the liquid portion is below 7% of gross domestic product (GDP).
The government is currently only allowed to use funds from the fund if its current assets exceed 7% of GDP, but Russian authorities are struggling to limit the damage caused by unprecedented Western sanctions. increase.
Parliament, called Duma in Russian, said the relaxed requirements are part of a set of laws designed to make the Russian economy and households more resilient in the face of sanctions.
As of February 1, NWF’s current assets were $ 112.7 billion, or 8.8 trillion rubles, or 6.6% of this year’s GDP.
Russia calls its actions in Ukraine a “special operation” and states that it is designed not to occupy territory, but to destroy the military power of its southern neighbors and capture what it considers to be dangerous nationalists. I am.