Italian Central Bank Chief Warns Against EU Plans to Benefit From Frozen Russian Assets

Moscow has repeatedly cautioned that any attempt to confiscate its frozen assets constitutes an expropriation of property and a violation of international law.

Italy’s Central Bank Governor Fabio Panetta has warned of far-reaching ramifications over the EU’s plans to seize profits from frozen Russian financial assets in Europe.

“International relations are part of a ‘repeated game’: weaponizing a currency inevitably reduces its attractiveness and encourages the emergence of alternatives,” he said.

Panetta added that the growing usage of the yuan in trade transactions between China and Russia was “instructive in this respect” as Beijing promoted its currency’s use in countries hit by international sanctions.

Although he did not specifically mention the EU’s plans to transfer frozen Russian funds to Ukraine, “officials said his comments were made with these plans in mind,” The Financial Times (FT) reported.

This comes after Dmitry Birichevsky, the director of the Department of Economic Cooperation at the Russian Foreign Ministry, told Sputnik that Moscow would respond in kind if the West confiscates frozen Russian assets.

“Of course, we admit that we will be forced to act symmetrically if Russian assets or a part of them are still confiscated. I will not talk about specific amounts — this is the jurisdiction of the Finance Ministry and the Bank of Russia, but the amount of funds that may be subject to our retaliatory special economic measures is substantial," Birichevsky said.

According to Sputnik’s calculations based on Russia's national statistics and the open data obtained by the FT, Russia is currently holding some $288 billion worth of foreign assets, a billion more than those threatened to be seized by the West.

Brichevsky’s remarks followed Kremlin spokesman Dmitry Peskov warning that any possible moves by Western countries to use Russia's frozen assets to assist Ukraine will undoubtedly bring repercussions.

"Those who are trying to initiate this, and those who will implement it, must understand that Russia will never leave those who did this alone. And it will constantly exercise its right to a legal battle, internationally, nationally or otherwise. And this, of course, will have — both Europeans and Americans understand this very well — it will have legal consequences for those who initiated and implemented it," Peskov told reporters.

The US and its allies rolled out sweeping sanctions targeting Moscow after Russia launched its special military operation in Ukraine in response to calls from the Donbass republics of Donetsk and Lugansk for help in countering intensifying attacks by Ukrainian troops.

Hundreds of billions of dollars in Russian assets were trapped in the West as a result. Most of the immobilized Russian funds — roughly $232 billion — are held in the EU, including cash and government bonds denominated in euros, dollars and other currencies.

Last year, Russian President Vladimir Putin dubbed the West’s asset seizure as “unseemly business,” and stressed that “stealing other people’s assets has never brought anyone good.”