Russian Economy General News: #12

Well I suppose it was a bit too good to be true

The story planted by NYT "reporter" Anatoly Kurmanaev is fake. No US officials are meeting with Venezuelan government in Caracas. This is probably part of psyops play to divide Russia from Venezuela. They may also be desperate now that the Iran deal isn't looking so promising and now they are scrambling by trying to gauge any type of response from the Venezuelans. The Orinoco Tribune is all over this BS.

https://orinocotribune.com/senior-us-officials-to-meet-with-government-of-president-nicolas-maduro-more-nyt-fake-news/

In a tweet, La Tabla posted: “It is even striking that the anniversary of the executive order—declaring Venezuela an unusual and extraordinary threat—is March 8, but the Joe Biden administration anticipated the renewal and did so five days earlier this year. If the contact with the Maduro government was planned, it could have waited a few hours for the renewal.”

Electronic import replacement. Recently on BMPD blog I saw Kommmersant interview where

Novaya Gazeta under the heading “Current Events Guarantee Victory for China. Russia's dependence on the Celestial Empire will begin to grow at a gigantic pace. Why?"

published an interview with a well-known Russian sinologist, director of the Center for Comprehensive European and International Studies at the Higher School of Economics (HSE) and a former employee of the Center for Analysis of Strategies and Technologies (CAST) Vasily Kashin .

https://bmpd.livejournal.com/4494288.html

my observations:

1) journalist is vsoprepalthik claiming no no we all gonna die without WEST.  

2) HSE guy in turn sounds quite reasonable.

3) Journo tries to push his agenda (check point 1) no no Chinese will force Russia to their agenda (debunked by HSE guy)

4) and Russia will be totally dependent on China (like strategically important stuff cannot gradually make herself?)






Nowhere i can see any thinking about : in case we didn't do something how long does it take to make it ourselves? how economically viable vs, strategically needed would it be?
That's what's  the  most important question now to me.

I'm not reading kommysont.

What does it really say? Your breakdown didn't say anything about electronics.

miketheterrible wrote:I'm not reading kommysont.

What does it really say?  Your breakdown didn't say anything about electronics.

Articles though in Russian press are pure nato propaganda. Im interested though about how realistically Russia can workout mid/long term strategy to develop own supplies in strategically important microelectronics.




As for articles. They were just trigger to above question, My bad there were 2 articles 1 Forbes, pro-murican shit in Russian journos (linke below)
- in short nothing can happen without the WEST.

Prohibition on development: how Russian technologies will survive without semiconductors

Kostas Thigkos, an analyst with British intelligence supplier Janes, said in an interview with the Washington Post that the consequences of TSMC's refusal to manufacture chips for the Russian army would be "devastating."

Китаист Леонид Ковачич считает, что в нынешней ситуации Китай вряд ли может помочь России восполнить образующийся технологический пробел.
So their second expert in microelectronics is a sinologist Leonid Kovachitch and his

“The prospects for the development of digitalization and telecommunications in the Russian Federation gone to zero” the expert believes.

Like it was axiom - Russia cannot develop own technologies ever.





and below Kommersant "Vth colloumn" journo talking to HSE economist

— How will China help our "special operation" industrial complex? It also depends on supplies from the West, doesn't it?

- With our military-industrial complex, it's just easier. Both for us and for the Chinese, it has been under almost comprehensive Western sanctions for a very long time. The Chinese have been strengthening in recent years, and we have cooperated with them in the military-industrial sphere. Apparently, cooperation will grow, I believe that sanctions will have the least impact on it. The only thing, due to the complete impossibility of buying Western industrial equipment, we will buy more Chinese.

“We received from the West not only equipment, but also technologies and software. Here, too, can we count on China?

- It is impossible, of course, to talk about all technologies at once, this field consists of a thousand different directions. According to some of them, China has already become one of the world leaders, and according to others, it can only sadly copy something. There is a group of industries where we can develop powerful synergy with China, we can work together.

They will be interested in using Russian developers, mathematicians.

There are areas where they may be interested in industrial cooperation, there are areas where they are able to meet our needs for equipment. And they already have enterprises that, as part of the economic war with the United States, are under American sanctions. Including manufacturers of electronics and certain types of industrial equipment. Such enterprises simply God himself ordered to go to the Russian market. Although it is clear that there will be a number of areas where Chinese equipment will not be able to replace European equipment, and Russia will still try to purchase it in Europe through some channels.

Well, doesn't matter. We already know what Fab plants Russia has.

Angstrom, Angstrom T (it was under receivership but I imagine now they will transfer equipment elsewhere), Mikron Plant, GS nanotech. And I believe a few universities has their own fabrication equipment to make Komdiv mips processors.

Most people have zero knowledge about semiconductors.  For guidance systems and microcontrollers, chips running 100mhz mips or arm or sparc is enough. For day to day computers, specialized software tailored to MCST elbrus and RISC processors will be enough for HPC's, workstations and the like.

They could in theory design a processor more tailored to 65nm on what Mikron can do. Which may be sufficient for average needs.  If GS Nanotech get off their ass, then they could start making chips off of 45nm for MCST for time being till Russia produces alternative.

Then there is Chinese chips of various types which I believe are already sanctioned anyway.

Edit: I'm also going to start asking the mods to delete and or move posts that have nothing to do with economics and what not. You posting American propaganda or financed propaganda isn't news and frankly, I don't think any real person appreciates it.

Edit 2: And honestly, I have zero idea what is being worked on behind the scenes. Russia must have thought out this problem entirely and decided it was OK to go ahead. Honestly, they need to have opened up a company to produce chips of more modern design in Russia and also worked out with China a JV in such chip development. Or even look at companies in China willing to operate with Russia through thick and thin (maybe a shell company). Because it would have at least helped coushin the issue.

I'm an electrical engineer. Back in 2020, I installed a supervisory computer system for the PLCs driving some safety-related backup power sources (diesels) at a nuclear plant. The computer was based around a Pentium III processor. The hardware was ancient - dated back to late 00 or 01. But that is all that was needed.

Russia isn't going to struggle that much when it comes to industrial, automotive, and most aerospace applications. They will manage a lot better than pundits are saying. All of that stuff uses very old technology. Equipment from 10-12 years back is pretty much the norm. They use tried and true, not latest and greatest.

Now communications and consumer products is a different story. They lean heavily on the latest microelectronics. Russia doesn't have any good short term options there. The Chinese are starting to make their own photolithography equipment. Russia might be able to buy some or jointly develop some. But even the Chinese cannot make the very latest in process technology.

What about the IMF Special Drawing Rights as an alternative to the Dollar as a reserve currency and for trade?


https://www.theigc.org/project/the-viability-of-the-special-drawing-rights-as-an-international-reserve-asset/


What are the pros and cons of using the Swiss Franc as an alternative to the Dollar, Euro and Chinese Yuan? Switzerland is pretty neutral and a popular place for foreign saving accounts for wealthy individuals from all over the world?

https://www.swissinfo.ch/eng/hard-cash_the-swiss-franc--global-reserve-or-gourmet-currency-/41100110

SDR's wouldn't be an alternative currency anyways because they are based on existing currencies - and that means they are mostly based on Euros and dollars.

And the Swiss franc isn't used much for transactions because there is little to nothing that you can get with it. Switzerland isn't an industrial powerhouse. The limited covereage the franc has gained has been due to their historically good banking. And that is drying up because, truth be told, there are better places to bank today.

Russia is supposedly going to switch payments on a lot of their foreign debt to rubles. So sell products for rubles. Denominating more in yuan is also a good idea. And see what takes on.

Autodestruct wrote:

Now communications and consumer products is a different story.  They lean heavily on the latest microelectronics.  Russia doesn't have any good short term options there.   The Chinese are starting to make their own photolithography equipment.  Russia might be able to buy some or jointly develop some.  But even the Chinese cannot make the very latest in process technology.

Absolutely no options neither short , neither medium ,neither in the next 10 years.
This is because the mediocre president in chief , vladimir putin have been ignoring totally the true modernization of russian economy and all that the idiot focused russian industry, was about gas station pipelines to the west and other energy business , agriculture and selling weapons . also invested a fortune in cosmetic development of the nation with expensive parks , and in olympic facilities that will no longer will be used in any important event , unless Russia wants to have fun in competitions with cuba , africa and iran and have fun with that.  

Russia mediocre nation development and vulnerability to western sanctions is consequence
of putin short sighted policies , allowing the west to dominate for decades in advance technology
that is so popular in the world and so important for mayor civilian business and consumer use. Putin spoke in 2014 when the sanctions over ukraine started "how good was that the west sanctions russia because force them , to end their dependence on their products" . but as expected he did nothing  in the past 8 years , to completely end their dependence on the western technoly.

so truly the best news russia could get is to see russia  banned from western  AND asian allies high tech , and hopefully china will also obey the sanctions. This is the only way russia will change for good, when their president feel so ashamed of himself for not developing russia as a true independent nation and finally get tired of being such outdated and under developed country
and finally is forced to start a true nation development . This is the only way that russia can bypass
western sanctions ,when they become a truly independent nation and not a banana gas station country , just like IRAN ,that depends most of its economy in oil and natural gas sales..

People joke a lot about Iran being an oil petrostate but they are a food exporter.
Iranian steel production has also massively ramped up over past decade and a half as did their construction of vehicles.
They export motor vehicles all over the Middle East.

GarryB wrote:Trading in Yuan or Rubles makes sense... trading in Rubles creates demand for Rubles which is good for Russia, and trading in Yuan means you have Yuan you can then buy things from China without having to buy their currency first so it saves transfer fees and the like.

to me selling Russia's export goodies yuan (besides ruble) has yet another advantage. It supports Chinas yuan as fully convertible currency to vast resources: food, oil , gas, titanium...rare earth metals. This is pretty hard blow to US economy in mid long term. Yuan doesn't need any swift too...




The same articles and electronic related questions could be asked on an electronics thread too.

I think we all agree the articles are hogwash, but it is amusing when they post such crap.

I wonder if they are just posting it because that is the ideology they are supposed to be pumping out to keep the house of cards which is the west up and stable, or if they are that stupid and actually believe this horseshit.

I'm afraid both. There are people believing that US as apex predator has inherited law to rule the world. BTW its perhaps not that bad comparison. US can be like T-Rex to me. Short hands, died out and small agile mammals prevailed. And a distant descent of T-Rex is a chicken

I have several friends who think Putin has gone too far and these new sanctions are going to destroy Russia.
Of course they ignore what was happening in the 1990s which was worse... robbery on an enormous scale... and nobody in the west cared, except those making a killing...

IMHO those sanctions would be introduced anyway in time (MH17? Navalny assassination? hurricane Vova?) Putin just kicked them first not waiting to be attacked in moment ok for the West.


Russian economy now is switching to war mode. Very similar to 1941. I don't think liberal market has here a place in this "period of change". Economy will be hit hard in the beginning same as beginning of each war. Yet reorientation from mythical west (12% of population) to the rest of the "unimportant" world will take place . Of course those countries that world are able to withstand USA pressure. But at the end of the day USD goes down Yuan goes up. Russia remains in better position then before. Not dependent from West in colonial style.


BTW i post this here as an example of economy reorganization not because of satellites' production

The developer of satellites for advertising from space due to sanctions will switch to Chinese components

https://tass.ru/kosmos/13972117

MOSCOW, March 5. /TASS/. A developer of satellites that will show ads from space in the future is frustrated by the listing, but expects to use components from China. This was reported to TASS by the head of the Avant Space company (resident of Skolkovo) Anton Ossovsky.

Due to the situation around Ukraine, the US Department of Commerce has introduced tougher export controls on 91 organizations and individuals associated with the Russian Federation, in particular, the sanctions have affected Avant Space.

“We are disappointed, although not surprised, by the position of the US authorities, according to which space projects are becoming another field for settling political scores. But by blocking access to their financial markets and electronic components, the US is only opening up new paths for us. Now we will completely switch to the use of a component base from China and will focus even more attention on Chinese investors," Ossovsky said.

According to him, Avant Space intends to be more careful in choosing potential partners in the future. Legal entities associated with those responsible for the imposed restrictions will not be allowed to implement the company's projects.

The project involves launching satellites with laser diodes into orbit, with the help of which it will be possible to write messages in the sky. The first two microsatellites are to go into orbit in 2022 as part of the Constellation experiment. A flight prototype of the satellite, which will show advertisements from orbit, will be ready in April 2022.

In August last year, the company patented a method for laser transmission of data from space to Earth on the principle of a QR code. With the help of flickering lasers, a binary code is transmitted to the Earth, when you point the phone at a satellite from the constellation, the user will receive information in the form of text or a hyperlink.

Very good article that explain the true disaster that awaits Russia business development
without any way for access of technology made by the west. i have been warning about this
for years ,but who listen?     good job Putin.

Without an uninterrupted supply of high-end semiconductors it will be extremely difficult for Russian enterprises, telecommunications companies and cloud providers to maintain and develop their technology infrastructures going forward. “Just in terms of banks, for example, it is going to be difficult for any kind of data centre operation to keep going and the effects will be felt as the sanctions regime continues,” says GlobalData analyst Emir Halilovic.

The effect on Russia’s consumer market will be apparent almost immediately. “There is going to be a real lack of any type of electronics requiring more sophisticated chips inside,” says Halilovic. This includes laptops, phones and other consumer items. “I am very sceptical about the future of the the Russian tech industry if this sanctions regime holds for, let's say, six months, a year or even two years,” Halilovic adds.

As the situation unfolds, the effects of Taiwan's ban on semiconductors to Russia will become apparent. What is clear is that by standing alone, albeit with China as its ally, the country risks a catastrophic technology crisis it can ill afford in this digital age.

Russia is so outdated its technology industry ,that the only ability they had to produce
low end semicondutors chips was using German technology .. by paying germany companies to build
a FAB , because putin is so lame to do it himself in his country, a company that is now bankrupt..  hey but at least Putin have gold medals and lots of olympic avenues
to practice sports.  

Now putin's only hopes for Russa  industrial modernization is mother china ,that supply them with third grade semiconductors of the previous decade , that china use for low end cheap integrated circuits in cars..  i wonder if it will be possible for russia to do by hand mechanical computers.. like
everything started 50 years ago...  but that will be truly embarrassing if ever discovered by the western media, if they so desperate to go there.

Good job Putin.. if china says no thanks ,we don't want sanctions too, then it will a very long bumpy road Russia , the cubanization of the Russian economy.. where everything will be copied from the west and manufactured by hand , just fixing broken spare parts of western tech.  lol

how behind is russia in locally done high tech?  at least 30 years.. being conservative. Since Russia never ever in history produced its own semiconductors with their own technology, all they did was copy british western computer chip designs Ask germany help to build a low end fab for them but lately it was taiwan the one that manufacture everything Russia need . China apparently is only about 5 years only behind the west..

Perhaps russia can try to bribe friendly retired south korean engineers from samsung,to go and move to russia and secretly teach in russian universities the dark science of advance micro electronics , the entire process from a to z . This is something that i will have done in the year 2000 as President of Russia, and not 22 years later , but what options Russia have left? somewhere they need to start. good job Putin.  

https://www.investmentmonitor.ai/special-focus/ukraine-crisis/taiwan-semiconductor-ban-russia-catastrophe

The only positive thing about all this , is that the myth of Putin being a "genius" will end , and that everyone now will known in Russia and outside it , how retarded was Putin's strategy of development of the nation in the past 22 years . He went the most lazy fat way possible for russia development ,as if Russia was a banana republic of africa , with his focus on commodities industry   is unacceptable.     Rogozin which is roscosmons director ,spoke about this problems better than anyone..  he told  "We have lots of space rockets  in their inventory they can use , but have nothing to put inside them ,that is high tech ,because of western sanctions"      

The prime minister of Russia have a major degree in computer system engineering , he will be worth of trying in the position of President ,and putin sent to retirement , because at least he understand how important is high tech in the future of a nation. You simply cannot develop a nation today without high tech , and he could be the only hope left for Russia federation for a true nation modernization , and put an end to Russia shameful dependence of the west for its own development.  

One big problem with all this American bullshit is.. America doesn't trade with Russia anyway.
Its trade level is tiny. So America could "demand" sanctions and its Eurobitches obeyed.
Then realised it only harmed Europe,helped Russia, and had no little effect on America.

Additionally, sanctions don't really work nowadays.
Products are just sent via intermediaries.
Instead of companies working on projects directly, their staff break off to work on projects.
Hassle a country for using dollars... it de-dollarises and harms the dollar reserve status.
Seize Russian assets. Russia seizes yours/says" **** it we'll harm u in other ways".
And its all stimulating Russia's indigenous industries - just as was forecast.
It should see a resurgence in Russian culture, technology, art, architecture etc.
Instead of drifting towards being another outpost of American controlled globalism.

America would harrass other countries into US controlled oops "free" trade.
And harrass them up they didn't leave their markets wide open to US bribery and delevelled playing fields.
Now Russia and China are successful at "free trade", America opts for "anti free trade"+dirty tricks/outright mass murder ... literally.

So ultimately there is nothing great about this sort of "free trade". It becomes a form of slavery.
Russia can look forward to an indigeneous tech and aerospace industr. Instead of sending its brains to work for Boeing and Google etc, or being wage slaves in McDonalds. Sanctions are a disaster... for the US Deep State!

China can 100% substitute all the consumer products Russia consumes. Even Apple products are manufactured in China. Huawei is
more than good enough replacement.

This sanctions spazzing by the west will stimulate China's semiconductor industry via Russian demand and likely realization in China
that the west will terrorize them the same way. Hater blowhards in NATzO have bitten off more than they can chew as they
slice their own throat.

kvs wrote:China can 100% substitute all the consumer products Russia consumes.   Even Apple products are manufactured in China.   Huawei is
more than good enough replacement.

This sanctions spazzing by the west will stimulate China's semiconductor industry via Russian demand and likely realization in China
that the west will terrorize them the same way.   Hater blowhards in NATzO have bitten off more than they can chew as they
slice their own throat.  

 

This may revitalize Russian semiconductor industry with the aid of China.  China already heavily invested in Russia with Huawei.  Since they are sanctioned, they may look to further cooperate with Russia not just software level (that they have a facility in Russia for now), but hardware.

Same facilities in China that makes iPhones also made ripoff iPhones. I knew a guy from Iraq who would buy them and show me each one. They were impressive actually.

In addition to Russia's moves towards a gold backed ruble in an inflation reduction policy, it is critical to pursue reduced internal prices of oil by-products, especially diesel fuel oil, which by its products transportation affects the overall economy. And Russia being a big worldwide oil producer and possessing enough refinery capacity, it is perfectly capable of reaching enough general stabilization of consumer prices.

Kiko wrote:In addition to Russia's moves towards a gold backed ruble in an inflation reduction policy, it is critical to pursue reduced internal prices of oil by-products, especially diesel fuel oil, which by its products transportation affects the overall economy. And Russia being a big worldwide oil producer and possessing enough refinery capacity, it is perfectly capable of reaching enough general stabilization of consumer prices.

Gold backed currency will be trouble for long run.

I think a gold backed or resource backed Ruble separate from the current Ruble, would be very ideal for something like an investment more so than a currency.

Cryptocurrency in the form of giving a digital Ruble that works with lets say separate banks and industries that start their own crypto that allows staking and or creation of nodes for other benefits (like how FLUX works) and make it all tradable, along with holding and staking Golden Rub or something. This would actually make a shit tons more money and give incentive for the average person to jump in.

The chessmater player Strikes back.. Putin brilliant new 5 dimensional chess move allowed ,
the west to steal/froze half of Russian reserves.. about $300 billions wiped of russian reserves
with the stroke of a pen..


And still Russia wants to paid their debt to the west.


Russia don't deserve to win , when you have IDIOTS like Putin in charge of nation direction and development and the ones he put in charge of the different agencies , then you can do much ,
when a country never grows ,because is run by morons.

https://www.rt.com/business/551803-siluanov-russia-reserves-frozen/

This is what the rest of the world will think.. if they can do this to Russia how much worse it will be
for the rest of the world ? Putin is a major embarrassment for the nation , when he allows half of their nation currency reserves to be stolen.. why that idiot President allows such a thing to ever be possible to happen ? this is what happens , when you allow an idiot to run the presidency and for 22 years follow a financial system that was designed to rape your nation.

This is how Putin "the Great" can encourage nations ,to distance from the western system ,
by NOT leading with actions ,what they preach.. keeping so much Russian money of their painful savings in american banks.

This should be worthy of a Russian revolution , to kick putin and his incompetent government from power.

Russia reveals exact amount of reserves frozen by West

The country’s finance minister confirmed that nearly $300 billion of Russia’s forex holdings have been seized
Russia reveals exact amount of reserves frozen by West
Getty Images / Art Wager
The latest sanctions imposed on Russia over its military offensive in Ukraine have frozen about half of the country’s gold and foreign exchange reserves, according to Finance Minister Anton Siluanov.

“We have a total amount of reserves of about $640 billion, about $300 billion of reserves are now in a state in which we cannot use them,” he said in an interview with state TV channel Rossiya 1 on Sunday.

The minister added that the Western allies were putting pressure on China to limit trade relations with Russia to obstruct the Kremlin’s access to national reserves held in Chinese yuan.

https://www.rt.com/business/551803-siluanov-russia-reserves-frozen/


I think if they are so retarded ,that can't even protect their money , then they better disband the country and transform it , in a museum , because Russia is a joke of a nation. that not even russia can't abandon the western financial system because of how incompetent they are.

GarryB wrote:Vann, it is frozen... it is not yet stolen, and if they do steal it they destroy the fundamental international monetary system they have created.

It is as good as stolen. The US did the same thing to Iran decades ago. Remember before the US signed the deal with Iran part of the terms was the US repatriating Iranian USD money they had confiscated? They sent an airplane to Iran chock full of paper bills in various denominations.
https://edition.cnn.com/2016/08/03/politics/us-sends-plane-iran-400-million-cash/index.html

Then you had the US confiscating the gold reserves the Venezuelan Central Bank stored in London some years back. And the confiscation of the oil refineries and gas stations owned by Venezuelan state oil company Citgo in the US.

After their unilateral cancellation of the JCPOA the US also removed Iran from the SWIFT network.

Those were all preludes to the bullshit sanctions they made this time to Russia. Basically they think they are the world government and all other governments are subordinates, not equals, to them. They can freeze and confiscate your assets without recourse too.

You will soon see the West do some BS lawsuit where the assets confiscated from Russian businessmen will be sold for pennies on the dollar to their friends and the remainder capital will be put in a fund to compensate Ukrainian victims. A fund which they will funnel into their own pockets. Heck, they made Iran agree to pay money to victims of 9/11! WTF did Iran have to do with that. Ask Saudi Arabia for the money.

Russia is acting smart about this by paying back the loans in rubles. They can print as many of those as they want. If they keep the printing to a low enough level inflation won't rise too quickly.

What I think was a mistake was the law passed on ignoring patents and copyright. That will make a lot of companies not want to trade with Russia at all. Instead of such a blanket ban I think they should have made two laws even a lot of people in the West want enshrined into law for a long time. a) you are allowed to ignore patents and copyrights to keep equipment you purchased operational even without vendor support aka right to repair b) de-penalization of copyright infringement by private users. I believe Canada has a law like this for music where the state collects a small tax on storage media sales and pays that back to copyright industry associations like artist guilds.

Just these two laws alone would soften the blow that Western sanctions have made to a substantial degree.

The widespread cloning that the Soviets made without paying patent licenses for anything was part of the reason why after a point no one ever wanted to sell them stuff. In the long term it will be self-destructive.

Remember that while a lot of companies shuttered their operations for publicity reasons, a lot are stopping their operations for much more practical reasons, i.e. freezing SWIFT means they cannot effect payments of goods and materials in a globalized production chain, while other companies cannot get certain sanctioned products. A blanket erasure of patents will hurt not just those companies who want to leave but even those which want to stay. And they won't even bother to try to reproduce their production chain in Russia if the state can just confiscate the know-how of the patent of their production process. Those companies will leave too.

Russian citizens on the sanctions..



this clearly shows how russia made a major mistake in not developing and modernizing better
the economy and depending so much in western business.

GarryB wrote:Vann, it is frozen... it is not yet stolen, and if they do steal it they destroy the fundamental international monetary system they have created.

If your local bank says to you he does not like your religion or your views on gay sex with minors and they are going to freeze your bank accounts... when you start telling everyone that they are doing this it is going to effect that banks reputation and potential business.

The fact that you oppose or don't oppose gay sex, or the fact that you obviously oppose sex with minors... gay or heterosexual, is not a valid reason to lock your account and other people in the community who don't think the same way the perverts at the bank think will also realise their money is not safe there and start to make alternative arrangements.

The cost to the bank might be small to start off with, but if You and a few other customers find a better way to keep your money safe then others will follow and that will actually hurt the bank, in the short term and the longer term too.

300 billion of unavailable reserves is not much different from 300 billion in reserves that you are not currently using, and at the moment if they need to use reserves they have the rest of the 340 billion is still available for use if needed.

Those that seized the money likely have assets in Russia worth 100 times that anyway and those properties and products can be seized in response if necessary.

From Putins perspective it becomes an excellent incentive for Russia and Russians to not invest in the EU or US or the west in general where their property can be seized without warning, so in that sense it will likely lead to lots of resources and money flowing back to Russia.

I'm not a specialist, but if I understand the situation correctly the Russian money is jurisdictions where the "collective west" can't seize.

Deposits in foreign currency of any kind placed in some bank depends on that bank to have a correspondent account with a bank of the country of the deposited currency, what in practice means something like:

If the Russian EUR reserve is (hypothetically) in Deutsche Bank HK, this bank need to have a correspondent account with a bank in Europe (lets say Deutsche Bank DE) where the money will actually be deposited, but DB Hong Kong would still be the responsible of this deposit since this is registered with them.

So, in this scenario (as I understand) if EU seize the Russian money they will not just seize the Russian money but will also create a quite serious liability for the bank in Hong Kong who is responsible for the money which is "deposited" (registered) in HK, and also with China who responsible for this deposit above all of that. Also, I think (again, in this scenario) China could force DB HK to "convert" the Russian Euros to CNY/HKD/wherever and hand it to Russia; however China would get directly into the fire.

In this sense, while the money is frozen it still belongs to Russia, and so seems an acceptable situation in this circumstance.

[EDIT]

Btw, I have no idea if the money is in China but due to the sanctions against Hong Kong China implemented anti-sanctions legislation that allow them force (or punish) local banks/business to not comply with foreign sanctions, albeit I think that was never actually put in practice to avoid possible chaos in the HK financial system; however I don't think they created the legislation for nothing...