Russia’s economy faces being plunged into a fresh economic crisis following Moscow’s move to start military action in Ukraine.

The Russian ruble fell 10% to its lowest ever level against the U.S. dollar and euro Thursday morning within minutes of Russian President Vladimir Putin’s announcement of a “special operation.”

Tough economic sanctions from the West are certain to follow, with leaders in the U.S. and Europe staging emergency meetings Thursday to decide how to respond to what Joe Biden has called Moscow’s “flagrant aggression.”

Despite months of tensions and a significant troop buildup by Russian forces, the prospect of full-scale war was being largely dismissed in Moscow until earlier this week when Putin delivered an angry address to the nation undermining Ukraine’s sovereignty and peddling unjustified claims about a “genocide” in Ukraine.

Moscow claims its economy is well protected from any Western sanctions and the economic fallout that will follow.

“It will be painful, but we’ve got through it before,” an economics correspondent said in a news update on state TV on Wednesday, after the first tranche of sanctions were put in place.

The Russian government says it has built up significant government reserves — more than $630 billion — which it believes will protect the economy from the worst of any economic crisis.

The government runs an annual surplus — meaning it does not need to borrow cash on either the domestic or international markets — and government debt is below 20% of the country’s GDP.

Russia has also boasted about the success of its import substitution drive since it annexed Crimea in 2014, pointing mainly to the development of its agricultural industry thanks to a ban on food imports from the EU.

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