All right, Alexander, it has been some time since we have taken a look at the Russian economy and all the talk in and around the Russian economy is focused on the ruble. The ruble has hit 81, 82 to the dollar, and there's a lot of... Discussion, analysis, panic from some people. Some people are cheering in the collective West Sea. You see, all it needed was a year and three, four months, and the ruble is finally turning into rubble. How do you see things with the ruble? I'll just tell you that when I was in Moscow in 2018, say 18, 19. I remember the ruble was at like around 80 to the dollar and it wasn't a big deal. Actually, I think the Russian government was very happy to have the ruble at that rate.

That range anyway it is at 81 or 82 or something like that so what's your take on this yes i mean You're absolutely right. I mean, this is a completely, again, we constantly come up in Russia with these absolutely false, or at least... Completely misconceived misunderstandings about things now There was actually a good article about the ruble a couple of weeks ago in the Financial Times of all places in which they pointed out that what is now happening with the ruble is that Russia has effectively got capital controls. So you can't dash off in a Russian bank, convert all your rubles.

Rubles into dollars and you can't have a run on the ruble like of the kind that you had briefly at the start of last year when you know there was the february sanctions and all of those kind of things so the ruble rate today entirely reflects trade It is purely about trade flows. Now what we've seen over the last couple of months is that Rwy'n credu bod y cyfraniadau ar y llawr wedi llwyddo oherwydd y llawr yn yr amgueddfeydd bwyd. Roedd ymchwil yn yr amgueddfeydd bwyd. And then there's been another factor that's also caused the ruble to soften.

Mae hyn yn ddibwysol. Roedd y Prif Weinidog, Silwanov, yn siarad am hynny yn ystod y flwyddyn o'r blwyddyn newydd Creswm, ond mae'n cael ei allu gwneud yn ystod y flwyddyn. ...strength. The other factor is a rise in imports caused by a recovery in demand and an increase in production. And most of those imports, by the way, are coming from all kinds of places now, from China, from...

Firstly, it is insulating the budget from falls in oil prices. So when oil prices fall, Russia is able to sell its oil and receive payments in foreign currencies. Previously the dollar, now increasingly the Chinese RMB.

Those sort of currencies and then when it converts those foreign currencies into rubles which is what it actually spends its money on in russia it gets more rubles for the amount of foreign currency it earns through its oil price sales than it might otherwise do if the ruble had remained if the ruble had been remained strong so since that money eventually flows to the budget that protects the russian budget and it keeps the russian economy in total liquid so some

some economists some refer to this as a dirty float in other words russia just allowing the ruble to go up and down in terms of oil price flows and of course in terms of imports again since imports have to be paid for in foreign currencies rupees rmb and the rest again you have to sell rubles by those currencies in order to buy those products again the russian central bank

Government would rather the ruble fell in that kind of situation, making some of those imports more pricey, because what it wants to do is encourage domestic production. So at the same time, it provides some degree of protection for the domestic Russian economy, which the Russians are very, very keen to see expanding. And it works. It does have precisely that sort of effect. Now, oil prices are strengthening. OPEC Plus has cut oil production. There's talk about oil prices rising to $100 a barrel by the end of this year. If that happens, then over the second half of the year, we will see the ruble strengthen again. Y mae'r Prif Weinidog yn ei gynhyrchu. Felly, mae'r stori rhwbl hwnnw, fel y dywedais, yn amdanynig.

As I said, a misunderstanding. It is not a crisis. It is simply the Russian government operating a floating exchange rate, giving itself the flexibility that gives it. Something the russians have been doing ever since the autumn of 2014 this is absolutely standard there is absolutely nothing unusual about it there is a lot of economic news coming out of russia now inflation is below four percent on an annualized basis it's funny how people you know talk about the rate of the ruble and the rate of the ruble and they're not looking at prices inside russia itself which is really you know as far as what russians are concerned that's what really matters so Percent rising at an annualized level below four percent remember um

remember um interest rates are above that i believe that they're either at seven and a half or eight and a half percent so if you keep You are getting more you're getting more money your your your rubles are Your rubles are strengthened. You're getting more rubles than prices are rising. So actually, monetary conditions in Russia are actually quite tight at the moment. Yn ystod y cyfnod sylweddol ar ddechrau y flwyddyn, mae cynhyrchu diwylliannol yn cael ei gynyddu eto. Mae'r amrywiaeth yn cael ei gynyddu. Mae angen yn cael ei gynyddu oherwydd bod cyfraniadau gwirioneddol a chanlyniadau gwirioneddol yn cael eu cynyddu. Mae cyfraniadau gweithredu'n fwy gysylltiedig. Dyna un o'r rhesymau, fel y dywedais, pam mae'r rhwbl wedi cynyddu. There is one thing that is something of a mystery to me and which I don't fully understand and that is this, which is that if you remember back...

Felly, os ydych chi'n cofio, yn ôl, ym mis Ionawr, roedd yna, eto, llawer o bwysigrwydd, oherwydd, ym mis Ionawr, roedd Llywodraeth Cymru wedi cymryd defaid cyllid o 25 miliwn o ddolr. Yna, ym mis Medi, roedd Llywodraeth Cymru wedi cymryd... Now, they're saying that for the entirety of the first quarter, the budget deficit came to $29 billion, which would imply, mathematically, mathematically that there must have been a surplus a budget surplus in march now i'm not quite sure about this because i haven't seen the full pic full breakdown of the budget figures but it could

...reasons, if that is indeed what's happened, that one of the reasons is because the softening of the ruble has had its effect, or is having its effect, and it's causing the budget position to strengthen. The budget position to strengthen. But, you know, I'm going to keep back from giving a conclusive view because, as I said, I don't pretend I fully understand what happened to the Russian budget in March. But in the long term, it really doesn't matter because, overall, the Russian budget is strong and Russian reserves, financial reserves, are around $600 billion. Where by the way when the sanctions were first imposed yeah and do you have any news on the on the seizing of russian uh reserves has there been an update there or because last november was

Because last November was – they were looking for 300 billion but they could only identify 30 billion, the EU. That's right. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. No update on that and i think that 30 billion is all that they're ever going to find that that's ...is all that they're ever going to find. That is my own straightforward view about this. I think that the central bank had obviously taken precautions in advance. They'd protected their reserves. I'm not going to try and speculate about how it was done, but clearly reserves were transferred into third parties. The sanctions were imposed and I'm sure that they've all found their way to Shanghai and Hong Kong and all those sort of places. And all those sort of places and no doubt into russia itself and probably they've also been converted into gold by the way russian gold reserves are apparently growing once more and of course the

Actually, I believe by a Russian organization or think uh organization or think tank or i forgot the organization that did this Russia's growth to slow up until 2035 to something like around 1%. Did you, have you seen that? one percent did you have you seen i've seen many of these things i i don't think i mean to be straightforward about this these predictions about growth up to 2035 how can you make These are fantasy things, given the last year, you know, when the sanctions were imposed, most people, well, most people, most forecasters were predicting a Russian economic contraction in 2022.

Sciences the Russian that's that's the group. I found it now. Okay. Yeah, I know so I mean, you know They come up with these they come up with these produce So, I mean, you know, they come up with these, they come up with these predictions, but I don't take them particularly seriously because all kinds of things can change. All sorts of things can shift. Nobody can make predictions going forward that far. Report that Russia has cut its oil production more than was announced. What do you think is going on there? Did you buy into that Bloomberg report? Yeah, I mean, the trouble with this is, again, we're getting... Gwybodaeth? Ie, rydw i'n meddwl, mae'r broblem gyda hyn yw, eto, rydym yn cael llawer o straeon gwahanol a gwahanol am gynhyrchu olwg yng Nghymru. Ar yr un tro, rydw i wedi bod yn darllen gwybodaethau eraill bod argyfwngion Cymru o olwg ar lefelau record.

Thing is but i would have guessed that yes maybe they have cut oil production and perhaps they've cut it more than by the you know half a million barrels a day that they said they would if so i think this has been coordinated with opec plus in order to support oil prices again that that's all that this is that one shouldn't look for more complicated explanations than that and there are all kinds of studies about the russian economy i was reading about several in the guardian yesterday in which you know they were saying that all kinds of american academics have tried to Mae pob math o ddysgwyr Cymreig wedi ceisio gofyn bod y rhesesiwn yng Nghymru yn llawer llawer llawer llawer llawer llawer llawer llawer llawer llawer llawer llawer llawer llawer. I don't think we have anything like enough data to justify those sorts of claims. And I think that given

of claims and you know i i think that given how little data we have even about the rates of military production trying to Are what the Russians themselves tell us, and they are talking about an industrial recovery, a return in demand, and a Recovery, a return in demand, and abundant supplies in the shops. From russia is telling us the same thing if there'd been a collapse in collapse in production or even a fall in production for civilian goods at the same time that there's been a decline in imports in conditions of

In conditions of improving demand, you would be expecting inflation to rise. In fact, it's falling. How do you explain then that the U.S. or why is the U.S. sending out these sanctions specialists? The sanctions, I mean, it sounds to me like, I'm very confident the sanctions have failed. Russia appears to be in the clear. It's managed to weather the sanctions. Appears to be in the clear. It's managed to weather the sanction storm. It's moved away from the Western economic financial architecture and it's charting its own course now. They're still fixated on trying to find ways to enforce the sanctions in the belief that they're going to find

and force the sanctions in the belief that they're going to find the silver bullet that got away from them, this sanction. It'll lead to to some sort of downfall in the Russian economy. What I mean, they have all these experts. The U.S. has all of these economic experts. I mean, they have all these experts. The U.S. has all of these economic experts, financial experts. The economic war failed. Russia's in the clear. For the most part, it's happening. Sending these experts around to talk to countries and to try and close up the loopholes or figure out ways that they can toughen the sanctions in the belief that.

Can toughen the sanctions in the belief that they might have missed something. We missed that something in trade with Turkey that allowed the Russians to avoid sanctions collapse. Mae'n ceisio isoleu'r economi Rwydwaith. Mae hynny wedi colli'n hollol. Os bydd China yn cynnal ei ffrindiau gyda Rwydwaith, sef yr hyn a ddododd Cyshynping i Mosgwch, ac os bydd India yn cynnal ei ffrindiau gyda Rwydwaith, sef yr hyn rydyn ni wedi gweld gyda'r Uned, ac os bydd Jepun yn mynd i ddewis arian o'r Rwydwaith o'r rhaglen pris, fel maen nhw hefyd wedi dweud, from Russia above the price gap, as they've also said, then, you know, you can go around to all these little countries. Well, Turkey's not a little country, but you've got other countries and it's not going to make any difference. But psychologically, if you're in Washington,

is impossible. So if the sanctions are not working, it has to be because some So you're going to sort of send people around the world, primarily to Europe but also to Malaysia, to Singapore, to wherever, trying to get them, threaten them to enforce and apply these sanctions. And you're going to lose goodwill, you're going to anger an awful lot of people by doing it.

states cannot bring itself to do by the way i heard all of this happen way back in 2014 a friend of mine who was in singapore at the time this is back in 2014 mine 2015 so that you know that time already they were getting delegations from the treasury the the treasury department telling them that they had to enforce the sanctions in singapore and the singaporeans shrugged their shoulders and they said look we're not going to allow the russians to circumvent the sanctions in singapore your sanctions but we're not going to apply any sanctions of our own so there's nothing new about this all right okay we will leave it there the durian

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