Diary of a Journalist: Life is Changing in Russia Under Economic Sanctions

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As first time visitors to Russia, our first thought was to convert some money and see what the exchange rate was.

We traded $400 for 37,200 rubles on Wednesday. A dollar was worth 93 rubles at the time. But that number was 78 on February 25, the day we arrived in Moscow.

Now that the ruble has depreciated, we wondered if the prices of basic necessities had also changed. We went to a supermarket to find that the prices had not changed.

And our Visa and Mastercard still worked in the country, at least for now.

One dollar was worth 93 rubles on March 2, 2022. /CGTN

One dollar was worth 93 rubles on March 2, 2022. /CGTN

In the meantime, not wanting to lose profit, multinational operators have started to suspend their cooperation with Russia from this week. SKF, the world’s largest bearing maker, suspended deliveries to Russian customers while Nike closed its online shopping channel in the country.

A few automakers have also announced plans to shut down operations. Mercedes decided to stop making cars in the Moscow region, while Ford announced it was suspending joint venture activities in Russia. Several aerospace companies have also followed suit. Brazil’s Embraer has stopped supplying parts and technical maintenance to Russia, and Boeing has announced it is suspending major operations in Moscow.

On Wednesday, Apple joined a number of Western companies in announcing that it would stop selling services and products in Russia. However, the Russian high-end Apple retailer Re:Store reopened on Thursday and raised prices for the devices.

Apple has suspended online services in Russia since March 2, 2022. /CGTN

Apple has suspended online services in Russia since March 2, 2022. /CGTN

And IKEA, the Swedish furniture chain, said it would suspend operations in Russia and Belarus on Thursday. Hundreds of people in Moscow flocked to the store right after work.

“We stay here for two hours. I think we have to stay about 30 minutes more,” a local resident told CGTN. “We came here because IKEA is about to close.”

Also Thursday, seven Russian banks were barred from the SWIFT financial messaging system, making cross-border payments more difficult.

People line up at the IKEA cash desk in Moscow, March 3, 2022. /CGTN

People line up at the IKEA cash desk in Moscow, March 3, 2022. /CGTN

For those unsure of what to do with their foreign currency, Grigory Beglarian, host of a business radio show, suggested people stay calm.

“There is always a pause after the shock. I suggest waiting for a pause. At the expense of currency selling, leave a small portion just in case,” he said.

As part of the countermeasures to the economic sanctions, Russia’s central bank raised interest rates to an unprecedented 20%. Some people who queued to withdraw money a few days ago are now returning to deposit their money in banks.

(Cover: CGTN reporter Liu Jiaxin in Moscow, Russia. /CGTN)

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