Wellink expects the new package of sanctions agreed by the European Union, the United States, Canada and the United Kingdom to deal a “huge blow” to the Russian economy.
However, he does not expect this to lead to Putin’s knockout exit. “If you look at Iran, where the sanctions have been much stricter, it has caused a lot of misery, but it has not caused the economy to collapse. We are also talking about a dictator here and they usually just don’t go. If you want to impose sanctions to change behaviour, they will They take on this role more.”
A lot of work
Implementing the sanctions requires a lot of work for European and Dutch banks. For example, sanctions lists should be updated and payments verified. Wellink expects banks to be able to handle this, but he anticipates difficulties. “Swift is simple in this sense: it gives a unique code when transferring to another country. If that code is Russian, you can block it.”
Banning the accounts of oligarchs and others is more difficult if intermediaries are used. “If that goes through the Netherlands, you have to think about everything. This is complicated and it would be a huge undertaking.”
The former banker believes whether a recession can be expected due to the situation in Ukraine is still uncertain. “It really depends on whether we panic. When that happens and people stop buying, the impact is greater than the direct impact of what’s really going on in the financial sector.”
