The Impact of the Sanctions Policy of Unfriendly Countries on the Russian Financial System

Abstract

In the context of unprecedented sanctions pressure, the author examined the current situation in Russian financial system analyzing the reasons for the current trends in the growth of public finances against the backdrop of a low growth in gross domestic product. The study identified main directions taken at the state level and discussed their consequences. The measures are the following: introduction of a financial policy to combat the «Dutch disease»; maximum openness of the Russian financial system for international finance; active policy of borrowing in international financial markets; improvement of tax administration and concentration of financial resources of budget organizations in the treasury system; development of a system to stimulate the demand of individuals, which forms «long money» in the economy and the consumer behavior of the population; formation of a financial center in Moscow; and imbalance of regional budgets. The aim of the study was to examine the financing of the regional economy in the context of EU and Anglo-Saxon sanctions. The author highlighted two unresolved problems: underestimation of the role of finance in economic growth and development of the regions and the problem of direct link of finance and reproduction. The paper analyzed the impact of sanctions against Russia on the functioning of the country's financial system as a whole and on the factors of production. The study revealed that a significant adjustment of the scientific paradigm of financing at the state and sub-federal levels is necessary to ensure economic growth and development of Russia.