May 26, 2022

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Index – Economy – Putin’s feverish dream The Russian economy is short

Said last week Talk for almost an hour It clearly demonstrates that Vladimir Putin had complex, complex sentiments about Russia’s historical past. Duality in history:

His father was a war veteran and a loyal communist who secretly baptized his mother Putin, then a child, a devout Russian Orthodox.

He grew up between these two mutually exclusive ideas. It is clear that he uses these two rhetoric well with his current interests. Now we can hear the deafening music of Russian nationalism, but this record is not in Russia, but in Ukraine.

Already at the 2008 summit in Bucharest, he called Ukraine a “very complex country” that was somewhat “annexed from territories taken from Russia”. At the time, Ukraine still seemed to recognize its territorial integrity. But in the following years, the “Kiev problem” took on an increasingly comprehensive form and began to form the consciousness of modern-day Russian imperialism.

It will now be difficult to close the heavy doors of “historic Russia” opened by Putin. His latest words and deeds show that he has become a radical nationalist. He became the defender of the Russians once and for all, he could not be defeated on the cheek.

But it requires a national economy that has been built up over decades. Now, as a result of sanctions, the test has certainly begun.

Russia became an isolated Soviet economy

After the Russian invasion of Ukraine, the economic war began: the West imposed unprecedented sanctions. Investors are throwing Russian assets as fast as they can. The ruble has lost a third of its value so far this year alone. The Capital economy The consultancy firm expects Russian inflation to reach 15 percent soon and fall to 5 percent of GDP.

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The The decline of Russian markets President Vladimir Putin’s years of building Russia’s economic security have taken many by surprise. There have been several reports that the country easily opposes punitive measures. Putin said the Russian economy was not only protectionist, but also a stronghold of the Arctic tundra, just like the Western Hemisphere.

This economic stronghold was also a product of Russia’s recent turbulent history: after the break-up of the Soviet Union in 1991, brutal inflation erupted, and they went bankrupt in 1998, causing the ruble to fall by two-thirds. Then in 2014 Crimea By Russia In the aftermath of the attack, oil prices plummeted and international sanctions pushed the economy into recession.

Moscow’s strategy is to diversify its oil and gas – based economy, reduce its dependence on Western technology and trade, reduce foreign debt, adhere to tight monetary and monetary policies, and accumulate gold.

This is not even a bad plan for a country that is rich and strives for a protectionist national economy.

Success: Between 2000 and 2019, Russia’s service sector grew by 7 percent of GDP. The economist calculates, The technological bias of Russia’s western countries has disappeared in some areas, with the Russian payment system (MIR) accounting for a quarter of domestic card transactions by 2020, so no one heard its news five years ago. Moreover, according to the World Bank, technology imports in the country have also declined.

But Putin has not been able to break free from the supply chain between Western inventions, high technology and the continents surrounding his economy. About 30 percent of Russian imports come from the G7, which is slightly different from the 2014 figures. Moreover, there are analysts who say that Russia is still completely dependent on US components for its chip and computer production.

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The best example of this Bank cards of the Russian financial institution Due to restrictions, they do not work with Apple Pay or Google Pay. This caused a disruption in the Moscow metro, with people unable to get out of the revolving doors.

Putin’s economy Not interested in punitive action, Because one of the basic tenets of his rhetoric is survival. The pain here is that, because of the West, Russia has always stuck to something throughout history.

When the loophole is tightened and obstacles come, this survivalist imperialist feeling is strengthened.

As President of Russia, he will persecute the country as much as he oppresses all Orthodox defenders and restorers of the Russian Empire. Moreover, in their rhetoric, as Foreign Minister Sergei Lavrov said, the West has so far “ignored them in disgrace”.

The Russian market will change

Russian President Vladimir Putin has been repeatedly warned that the West will destroy its economy if it invades Ukraine. Nevertheless, he decided to send the tanks there. For their part, the United States and the European Union and their allies have made no secret of their efforts to suppress Putin.

Kremlin spokesman Dmitry Peskov acknowledged that the effects of the sanctions were already “painful”:

The Russian economy is now under severe pressure and is undergoing a severe blow.

To this end, Moscow is introducing capital restrictions in an attempt to prevent foreign companies from leaving Russia. The number of economists who believe these measures will prevent flooding is very small.

Energy companies such as BP or Shell have already announced their departure. This kind of departure is not limited to the financial dimensions, as Russia also requires high technology.

All in all, this is a wonderful sudden break from the international economy. US President Joe Biden has warned Putin that he will “pay a high price in the long run” and that the Russian leader “does not know what is coming.” The question now is whether Moscow can isolate its vast economy.

Beijing now has the opportunity to rush to Moscow’s aid. This can be a major issue for effective barriers. But if this comes to the wrath of the West, he too will fall apart According to politics.

We follow the events of the Russo-Ukrainian war, and our Saturday article is updated minute by minute. You can find it here.

(Cover: Vladimir Putin on February 27, 2022. Photo: Sergei Kuneyev / Sputnik / AFP)