Tensions between the West and Vladimir Putin’s Russia ratcheted higher still on Friday, when Janet Yellen took aim at her former counterpart, among other high profile officials following sham referendums in occupied Ukrainian territories.
“We will not stand by as Putin fraudulently attempts to annex parts of Ukraine,” Yellen said, unveiling measures aimed at Elvira Nabiullina, among other “key leaders in Russia’s financial architecture.”
Arguably, Nabiullina was Putin’s most formidable weapon in the early days of the invasion. A skilled technocrat, Nabiullina is no slouch. Far from it. As central bankers go, she’s highly capable. When her mettle was tested this year under the most onerous circumstances imaginable, she moved deftly and decisively, first to shield the economy, then to shore up the ruble and finally to establish something that looks vaguely like stability — a new “normal,” as it were.
It’s impossible to overstate the scope of the challenges Nabiullina faced. She stared down a tidal wave of Western sanctions which quickly made Russia the most penalized nation on the planet (figure below). Her reserves were seized, her SWIFT access severed, her bank sanctioned and her nation forced into default. Undaunted, she steered the economy away from oblivion, despite the ruinous path pursued by Putin, whose imperial ambitions turned Russia into a pariah state. She was previously sanctioned by Canada and Australia.
Nabiullina didn’t embrace the role of wartime consigliere. She reportedly tried to resign when Putin decided to move ahead with his “special operation” because she recognized the distinct possibility that her skillset would be rendered useless. She remained in her post after being told a resignation would be viewed by Putin as a “betrayal.”
Yellen also sanctioned Nabiullina’s deputy, Olga Skorobogatova, and deputy prime minister Alexander Novak. As most readers are doubtlessly aware, Novak is a somebody. A mainstay of OPEC negotiations and a key actor in Putin’s regime, Novak is among the most well-known Russian officials among market participants.
In addition to the Treasury actions, the State Department imposed visa restrictions on more than 900 people, including Russian and Belarusian military officials and associates. The Commerce Department, meanwhile, added some five-dozen entities to an export blacklist and issued an advisory warning against supplying Russia or Belarus with military or industrial support.
Yellen said the raft of new measures would “further weaken Russia’s already degraded military industrial complex and undermine its ability to wage its illegal war.”
Nabiullina has presided over the central bank for nearly a decade. In addition to her efforts in 2022, she’s “credited” with shielding the Kremlin from Western sanctions following Putin’s occupation of Crimea in 2014. Her competence is Putin’s asset, but increasingly, her liability. As evidence mounts that the Russian war machine is committing atrocities, her legacy could be defined by complicity in one of modernity’s darker episodes.
At a signing ceremony marking the annexations of four Ukrainian territories Friday, Putin said, of the local populations, “They will become our citizens forever.”