1
00:00:00,120 --> 00:00:06,800
Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

2
00:00:07,200 --> 00:00:09,760
Speaker 2: Here's the latest, President Biden slapping Russia with a set

3
00:00:09,760 --> 00:00:12,520
Speaker 2: of five hundred fresh sanctions after the death of opposition

4
00:00:12,600 --> 00:00:15,079
Speaker 2: leader Alexi Navauni, the White House sank. Some of the

5
00:00:15,120 --> 00:00:18,279
Speaker 2: sanctions will target those responsible for Nevalde's death, with the

6
00:00:18,320 --> 00:00:21,600
Speaker 2: majority aimed at Putin's so called war machine. The sanctions

7
00:00:21,680 --> 00:00:24,439
Speaker 2: landing is the Russia Ukraine war hits the two year mark.

8
00:00:24,680 --> 00:00:27,600
Speaker 2: Joining us now to discuss is Deputy Treasury Secretary Wally

9
00:00:27,760 --> 00:00:29,720
Speaker 2: at A Yamo. Wally, great to see you in person, Sir,

10
00:00:29,800 --> 00:00:32,080
Speaker 2: fantastica have you with us around the table. Let's start

11
00:00:32,120 --> 00:00:34,240
Speaker 2: with the recent effort. There isn't much that you haven't

12
00:00:34,280 --> 00:00:36,559
Speaker 2: sanctioned over the last two years. What's new about this

13
00:00:37,080 --> 00:00:38,080
Speaker 2: and what's the objective?

14
00:00:38,520 --> 00:00:41,560
Speaker 3: Important? Remember that our objective remains the same, going after

15
00:00:41,640 --> 00:00:44,840
Speaker 3: Russia's military and dutchillized complex and their ability to earn

16
00:00:44,920 --> 00:00:47,440
Speaker 3: money to prop up their economy and buy the goods

17
00:00:47,479 --> 00:00:49,680
Speaker 3: they need to fight the war they want. What we're

18
00:00:49,720 --> 00:00:52,640
Speaker 3: doing today is we are furthering those actions by going

19
00:00:52,680 --> 00:00:56,640
Speaker 3: after companies in Russia that are helping to build military equipment. Today,

20
00:00:56,720 --> 00:01:00,360
Speaker 3: Russia's running a wartime economy. Factories that used to produce

21
00:01:00,440 --> 00:01:05,160
Speaker 3: goods for Russian civilians now producing military equipment. We're sanctioning

22
00:01:05,160 --> 00:01:07,680
Speaker 3: those companies, but we're also going after the companies that

23
00:01:07,760 --> 00:01:10,880
Speaker 3: supplied them in third countries in order to make clear

24
00:01:11,000 --> 00:01:13,520
Speaker 3: to companies in third countries that you have a choice.

25
00:01:13,680 --> 00:01:15,840
Speaker 3: You can do business with Russia and their military and

26
00:01:15,880 --> 00:01:18,600
Speaker 3: docise complex, or you can do business with the United

27
00:01:18,600 --> 00:01:21,160
Speaker 3: States and our allies and partners who are joining us

28
00:01:21,160 --> 00:01:21,640
Speaker 3: in this effort.

29
00:01:21,800 --> 00:01:23,480
Speaker 2: What's India's answer to that right now?

30
00:01:23,920 --> 00:01:27,240
Speaker 3: What we've seen from companies in India, but companies around

31
00:01:27,280 --> 00:01:29,600
Speaker 3: the world is that when they have a choice between

32
00:01:29,680 --> 00:01:31,560
Speaker 3: being able to sell things to fifty percent of the

33
00:01:31,600 --> 00:01:36,200
Speaker 3: global economy versus selling things to Russia's military do scize complex,

34
00:01:36,400 --> 00:01:38,520
Speaker 3: the choice is pretty easy for them. The key thing

35
00:01:38,520 --> 00:01:40,440
Speaker 3: that we're doing today is we're sanctioning a number of

36
00:01:40,480 --> 00:01:43,640
Speaker 3: companies you've never heard of that Russia has set up

37
00:01:43,680 --> 00:01:46,679
Speaker 3: to try and buy things from India and other countries.

38
00:01:46,920 --> 00:01:49,040
Speaker 3: And by sanctioning those companies, we put them on the

39
00:01:49,120 --> 00:01:51,880
Speaker 3: radar of companies in India and in countries around the world,

40
00:01:51,920 --> 00:01:53,920
Speaker 3: and they know that they can no longer do business

41
00:01:53,920 --> 00:01:54,240
Speaker 3: with them.

42
00:01:54,640 --> 00:01:56,600
Speaker 1: When you look at the Russian economy, though the IMF

43
00:01:56,680 --> 00:02:00,360
Speaker 1: has upgraded their growth forecast for it. Sanctions have worked

44
00:02:00,400 --> 00:02:02,760
Speaker 1: in the sense that the ruble has not been brought

45
00:02:02,800 --> 00:02:06,080
Speaker 1: to rubble as President Biden promised. Have sanctions worked or

46
00:02:06,080 --> 00:02:07,440
Speaker 1: they've just created new markets.

47
00:02:08,000 --> 00:02:09,919
Speaker 3: So it's important for us to remember what our objectives

48
00:02:09,960 --> 00:02:12,840
Speaker 3: are with sanctions. They're to do two things. Reduce Russia's

49
00:02:12,840 --> 00:02:15,400
Speaker 3: revenues and put sand in the gears of the military

50
00:02:15,400 --> 00:02:18,600
Speaker 3: and dust sized complex. Russia's revenues from selling oil, their

51
00:02:18,639 --> 00:02:22,399
Speaker 3: most important product, down forty percent because the price cap

52
00:02:22,440 --> 00:02:24,799
Speaker 3: and the sanctions that we put in place, and we've

53
00:02:24,840 --> 00:02:28,240
Speaker 3: promised to do more. Russia's expenses for their military are

54
00:02:28,320 --> 00:02:32,280
Speaker 3: up seventy percent. Your viewers, they run companies, they invest.

55
00:02:32,680 --> 00:02:35,680
Speaker 3: Any company where the expenses are up seventy percent revenues

56
00:02:35,720 --> 00:02:38,799
Speaker 3: are down forty percent is not an investable economy. Russia's

57
00:02:38,880 --> 00:02:41,720
Speaker 3: GDP is up, you're right, because they're spending more, But

58
00:02:41,760 --> 00:02:44,600
Speaker 3: so's inflation and so are interest rates, and over time

59
00:02:44,880 --> 00:02:47,400
Speaker 3: that leads to a formula of a country getting smaller

60
00:02:47,440 --> 00:02:48,679
Speaker 3: and weaker, not stronger.

61
00:02:49,240 --> 00:02:51,919
Speaker 1: The price cap, though it hasn't worked all the time.

62
00:02:52,040 --> 00:02:56,120
Speaker 1: Russia is using shadow fleets very hard to track this,

63
00:02:56,840 --> 00:02:59,680
Speaker 1: so there are times when they are just selling Carte

64
00:02:59,720 --> 00:03:02,120
Speaker 1: bland how much they want to India and China. India

65
00:03:02,120 --> 00:03:05,120
Speaker 1: has basically replace Europe, so they have found a way

66
00:03:05,160 --> 00:03:09,200
Speaker 1: to go around US sanctions to continue funding their war

67
00:03:09,200 --> 00:03:12,160
Speaker 1: because Putin funds his war by oil and gas exports.

68
00:03:12,200 --> 00:03:13,880
Speaker 3: So you're right that Russia is looking for ways to

69
00:03:13,880 --> 00:03:16,800
Speaker 3: circumvent OUR sanctions. But the route you mentioned there is

70
00:03:16,840 --> 00:03:19,720
Speaker 3: one where what the Russians have are two choices. One

71
00:03:20,120 --> 00:03:22,480
Speaker 3: is sell oil under the price cap for undred sixty

72
00:03:22,520 --> 00:03:25,040
Speaker 3: dollars or to build up their own shadow fleet. But

73
00:03:25,040 --> 00:03:26,960
Speaker 3: in order to build that shadow fleet, they have to

74
00:03:27,000 --> 00:03:30,880
Speaker 3: invest in tankers, not tanks. Every dollar they spend buying

75
00:03:30,880 --> 00:03:33,200
Speaker 3: a new tanker, every dollar they spend building up their

76
00:03:33,240 --> 00:03:35,560
Speaker 3: own ecosystem is a dollar they can't spend on this

77
00:03:35,680 --> 00:03:38,240
Speaker 3: war of choice in Ukraine. And we're going to continue

78
00:03:38,240 --> 00:03:39,920
Speaker 3: to force them to make those kind of hard choices.

79
00:03:40,120 --> 00:03:41,720
Speaker 2: Need to talk about the outfit in the ring three

80
00:03:41,800 --> 00:03:45,120
Speaker 2: hundred billion dollars, if Russian reserves the bulk of that

81
00:03:45,240 --> 00:03:47,680
Speaker 2: is in Belgium and in France. How close a way

82
00:03:47,760 --> 00:03:50,080
Speaker 2: to a decision on compascanetien that's reserves, So.

83
00:03:50,080 --> 00:03:52,680
Speaker 3: It's important to remember that. Just in December, our leaders

84
00:03:52,680 --> 00:03:55,160
Speaker 3: set out to have experts talk about what we can

85
00:03:55,200 --> 00:03:57,160
Speaker 3: do to make sure that Russia doesn't choose when it's

86
00:03:57,200 --> 00:04:00,280
Speaker 3: going to pay Ukraine for the damages it's done. Over

87
00:04:00,320 --> 00:04:02,440
Speaker 3: the course the last several weeks, we sat down with

88
00:04:02,520 --> 00:04:05,520
Speaker 3: experts across the G seven and we're looking for ways

89
00:04:05,520 --> 00:04:08,480
Speaker 3: to unlock the economic value of those reserves for the Russia,

90
00:04:08,520 --> 00:04:11,480
Speaker 3: for the Ukrainian people. We're already seeing Europe take a step,

91
00:04:11,520 --> 00:04:14,480
Speaker 3: for example the windfall profits tax, which they're using to

92
00:04:14,480 --> 00:04:17,039
Speaker 3: take the profits from some of the companies there to

93
00:04:17,120 --> 00:04:20,000
Speaker 3: move to Ukraine. And over time we're going to continue

94
00:04:20,000 --> 00:04:22,120
Speaker 3: working to look for new ways to unlock that economy.

95
00:04:22,120 --> 00:04:24,720
Speaker 2: Can you help me understand how that happens when Bounjum

96
00:04:24,760 --> 00:04:27,360
Speaker 2: and France, who aren't in direct conflict with Russia, how

97
00:04:27,400 --> 00:04:28,599
Speaker 2: do they go about doing that?

98
00:04:29,600 --> 00:04:32,080
Speaker 3: So the thing that we know is that ultimately what

99
00:04:32,680 --> 00:04:35,800
Speaker 3: Russia has done is violated international law. Our leaders have

100
00:04:35,839 --> 00:04:38,200
Speaker 3: made very clear that Russia's not getting back these assets

101
00:04:38,279 --> 00:04:43,960
Speaker 3: until they pay for reconstruction in Ukraine. Ultimately, Russia needs

102
00:04:44,000 --> 00:04:45,640
Speaker 3: to end this war, and our goal is to make

103
00:04:45,680 --> 00:04:48,400
Speaker 3: sure that we can use the assets that Russia has

104
00:04:48,600 --> 00:04:51,400
Speaker 3: around the world to fundamentally find.

105
00:04:51,200 --> 00:04:54,560
Speaker 2: Concern thy worry about undermining the rules basorder that we

106
00:04:54,640 --> 00:04:57,880
Speaker 2: will sit around this table and claim to support that. Ultimately,

107
00:04:57,920 --> 00:05:00,760
Speaker 2: if this sets a president that may be other economies,

108
00:05:00,839 --> 00:05:03,719
Speaker 2: Western emerging market economies will look at what's happening in

109
00:05:03,720 --> 00:05:05,520
Speaker 2: the West and say, I don't want any expose to

110
00:05:05,520 --> 00:05:08,320
Speaker 2: that currency anymore at all. Worried about that.

111
00:05:08,320 --> 00:05:10,560
Speaker 3: I think it's important for us to remember that. Ultimately,

112
00:05:10,640 --> 00:05:12,800
Speaker 3: one of the strengths of the coalition we've built is

113
00:05:12,800 --> 00:05:16,280
Speaker 3: that it represents the world's largest reserve currencies, and what

114
00:05:16,279 --> 00:05:18,440
Speaker 3: we're committed to doing if we take an action is

115
00:05:18,480 --> 00:05:22,239
Speaker 3: taking it across the G seven. Fundamentally, we do think

116
00:05:22,400 --> 00:05:25,960
Speaker 3: that Russia has a legal obligation to compensate Ukraine for

117
00:05:26,000 --> 00:05:28,240
Speaker 3: the damage that they've done. We have to remember that

118
00:05:28,320 --> 00:05:30,800
Speaker 3: Russia is the one who violated that rules based order

119
00:05:30,880 --> 00:05:34,039
Speaker 3: by invading Ukraine, and ultimately every action we will take

120
00:05:34,320 --> 00:05:36,760
Speaker 3: will be in keeping with international law, will be in

121
00:05:36,839 --> 00:05:38,960
Speaker 3: keeping with making sure that Ukraine is able to be

122
00:05:39,000 --> 00:05:42,359
Speaker 3: a functioning democracy. Our goal here is to use sanctions

123
00:05:42,400 --> 00:05:47,200
Speaker 3: and use our economic tools to slow down Russia, but Ultimately,

124
00:05:47,279 --> 00:05:50,520
Speaker 3: in order to speed up Ukraine, they need money. That's

125
00:05:50,560 --> 00:05:53,479
Speaker 3: why the President's focus on getting Congress to act. That's

126
00:05:53,520 --> 00:05:56,600
Speaker 3: why we're thinking about ways that we can use Russian assets,

127
00:05:56,800 --> 00:05:59,680
Speaker 3: the economic value of Russian's assets, to support the Ukrainian people,

128
00:06:00,000 --> 00:06:02,360
Speaker 3: because ultimately, what we have to do is ensure that

129
00:06:02,440 --> 00:06:05,480
Speaker 3: Russia learns the important lessons that you can't violate the

130
00:06:05,560 --> 00:06:07,160
Speaker 3: rules base order and get away with it.

131
00:06:07,240 --> 00:06:10,279
Speaker 1: Deputy Secretary, there's one space in the Russian economy that actually,

132
00:06:10,279 --> 00:06:12,359
Speaker 1: though has been a little bit safe, and that's the

133
00:06:12,360 --> 00:06:15,400
Speaker 1: metals market. Why are you not going after Nickel and Alumnum?

134
00:06:15,600 --> 00:06:17,280
Speaker 3: I would wait for a few minutes when we announce

135
00:06:17,279 --> 00:06:19,120
Speaker 3: our sanctions and you'll see that we're going after a

136
00:06:19,240 --> 00:06:21,320
Speaker 3: number of revenue sources. And what I want to make

137
00:06:21,360 --> 00:06:24,479
Speaker 3: clear to Russia is that as long as their invasion continues,

138
00:06:24,680 --> 00:06:27,200
Speaker 3: we're going to continue to go after their revenue sources

139
00:06:27,320 --> 00:06:29,279
Speaker 3: and also after the military industrialized complex.

140
00:06:29,360 --> 00:06:30,960
Speaker 2: Well, you can't tagte that without ton I guess, so

141
00:06:31,040 --> 00:06:33,000
Speaker 2: you GONGFTA, Nico and Alma.

142
00:06:33,400 --> 00:06:36,240
Speaker 3: I'm not going to preview the exact sanctions that we're doing,

143
00:06:36,279 --> 00:06:36,560
Speaker 3: but I.

144
00:06:36,520 --> 00:06:40,200
Speaker 2: Will say.

145
00:06:41,320 --> 00:06:42,240
Speaker 1: Market.

146
00:06:42,279 --> 00:06:44,359
Speaker 3: What I will say is that we are going after

147
00:06:44,440 --> 00:06:47,680
Speaker 3: the sectors of the economy that help Russia earn revenue.

148
00:06:47,880 --> 00:06:50,640
Speaker 3: That includes commodities. We know that that includes oil, and

149
00:06:50,640 --> 00:06:52,520
Speaker 3: we've went after the price cap. And what I will

150
00:06:52,720 --> 00:06:54,880
Speaker 3: what we've done is we've done in a targeted way

151
00:06:55,080 --> 00:06:57,800
Speaker 3: that has accomplished two goals. One is making it harder

152
00:06:57,800 --> 00:07:00,719
Speaker 3: for Russia to earn revenue while also taking steps to

153
00:07:00,760 --> 00:07:03,200
Speaker 3: make sure that we protect the rest of the global

154
00:07:03,200 --> 00:07:06,160
Speaker 3: economy from the repercussions of our actions. And we succeeded

155
00:07:06,160 --> 00:07:08,280
Speaker 3: in doing that. And you mentioned the price cap, where

156
00:07:08,360 --> 00:07:10,320
Speaker 3: Russia today is earning less revenue. You don't have to

157
00:07:10,360 --> 00:07:13,040
Speaker 3: believe me. The Russian deputy Prime minister just a few

158
00:07:13,040 --> 00:07:16,760
Speaker 3: weeks ago complained about the impact the Russian Russian price

159
00:07:16,760 --> 00:07:19,160
Speaker 3: cap is having on them. Ultimately, our goal is to

160
00:07:19,200 --> 00:07:21,920
Speaker 3: make that impact greater over time by taking these actions

161
00:07:22,040 --> 00:07:25,119
Speaker 3: while also stabilizing markets and making sure that global prices

162
00:07:25,120 --> 00:07:25,760
Speaker 3: don't run in.

163
00:07:25,680 --> 00:07:27,880
Speaker 1: The same breath. Alexander Novak is also talking about the

164
00:07:27,880 --> 00:07:29,840
Speaker 1: fact that they're able to get an entrance into India.

165
00:07:29,920 --> 00:07:32,400
Speaker 1: India has basically replaced Europe for them. They're still making

166
00:07:32,440 --> 00:07:34,680
Speaker 1: a ton of money. And I guess my point is

167
00:07:34,720 --> 00:07:37,160
Speaker 1: into the US is willing to take on the repercussions

168
00:07:37,160 --> 00:07:40,640
Speaker 1: of what it would mean for their economies. Should we

169
00:07:40,720 --> 00:07:41,720
Speaker 1: just expect this war.

170
00:07:41,560 --> 00:07:44,720
Speaker 3: To continue, No, You've got to look at what the

171
00:07:44,760 --> 00:07:47,600
Speaker 3: Ukrainians have been able to do. Ultimately, two years ago,

172
00:07:47,640 --> 00:07:50,120
Speaker 3: when we were sitting here, Russia thought they would take

173
00:07:50,200 --> 00:07:52,480
Speaker 3: the Ukrainian capital in days and take the whole country

174
00:07:52,480 --> 00:07:55,200
Speaker 3: in weeks. Ukraine has demonstrated to us that they have

175
00:07:55,280 --> 00:07:57,960
Speaker 3: the ability to defeat the Russians, but they need two things.

176
00:07:58,200 --> 00:08:00,320
Speaker 3: One is what we're doing with sanctions and experts also

177
00:08:00,360 --> 00:08:02,920
Speaker 3: slow down the Russians. But they also need money in

178
00:08:03,040 --> 00:08:04,880
Speaker 3: order to make sure that they have the weapons they

179
00:08:04,920 --> 00:08:07,400
Speaker 3: need to defend themselves. And that's why it's so critical

180
00:08:07,440 --> 00:08:09,640
Speaker 3: that Congress act to give them the weapons they need

181
00:08:09,680 --> 00:08:12,240
Speaker 3: to move forward. Because we've seen throughout history we know

182
00:08:12,280 --> 00:08:14,880
Speaker 3: how to defeat tyrants. But that requires us to take

183
00:08:14,920 --> 00:08:18,480
Speaker 3: actions that we're doing sex with sanctions, yeah, but also

184
00:08:18,520 --> 00:08:20,679
Speaker 3: the actions in terms of providing them with financial resources.

185
00:08:20,800 --> 00:08:22,360
Speaker 2: Sarah's good to see you here in New York. I'd

186
00:08:22,440 --> 00:08:24,320
Speaker 2: love to catch up at some point in the near

187
00:08:24,360 --> 00:08:26,400
Speaker 2: future and talk about nipp On Stale as well as

188
00:08:26,440 --> 00:08:27,880
Speaker 2: the stale industry. In America. We've got a lots of

189
00:08:27,880 --> 00:08:28,360
Speaker 2: discuss well.

190
00:08:28,360 --> 00:08:29,880
Speaker 3: I look forward to being back. Thank you guys for

191
00:08:29,920 --> 00:08:30,200
Speaker 3: having me.

192
00:08:30,240 --> 00:08:33,280
Speaker 2: Thank you, Sir Waleadiyamabad, the US Deputy Treasury Secretaries,