What happens when you show the world that you will seize assets of other countries for political reasons? Well, other countries don’t trust you to hold their money, that’s what happens.
According to Bloomberg, Saudi Arabia warned that it could sell off European holdings if the G7 countries seize nearly $300 billion in frozen Russian assets to help Ukraine, as they have said that they will. This is theft and it is immoral but also, it degrades international trust and will motivate the global community to put its money elsewhere. If China, Indonesia and other countries do this, it will further weaken the Euro.
Saudi Arabia said that it did not make these threats and that threats are not their style. Bloomberg’s reports were from “people familiar with the matter” and their private hints.
Europe has grappled with what to do with Russian holdings, but this spring, it decided not to seize the assets outright but instead “tap the profits.” That’s still stealing.
