Russia, Vladimir Putin | Russia's War Economy Thrives

Since Russia's annexation of Ukraine's Crimean Peninsula in 2014, the United States and the European Union have imposed a number of comprehensive sanctions packages against Russian companies and actors.

The expected effect was not achieved.

International Monetary Fund The Russian economy is expected to grow by 3.2 percent this year. By comparison, the forecast for Germany is 0.2 percent, for France 0.7 percent, and for Great Britain 0.5 percent.

Russia's arms industry is producing at full capacity, and the country does not seem to have any major problems getting the technology it needs.

Moscow has also found customers outside Europe for Russian oil and gas.

marginal effect

Western sanctions do not appear to have slowed the advance of Russian forces in Ukraine, where they now control just over 66,000 square kilometers, or about 18 percent of the country.

– The impact on the Russian war effort was marginal at best, Professor Stefan Hedlund stated: At Uppsala University earlier this year.

– Much-needed technology continues to flow to Russian arms manufacturers via third countries, noted Hedlund, who has researched the Russian economy for a number of years.

No weak

Head of US European Command General Christopher Cavoli He also sees no indication that Russia is about to weaken militarily.

– He said in April that Russia's strategic forces, long-range air forces, cyber capabilities, and capabilities in space and the electromagnetic spectrum had not weakened at all since the invasion of Ukraine.

Lieutenant Colonel Palle Ydstebo of the Military College believes that the war in Ukraine will not be decided at the front.

– The most important thing that is happening now is that it is not happening in Ukraine. It is believed that this is happening in factories in Russia and in the West.

Yedstebo describes the war in Ukraine as a war of industrial resources.

– In the end, it is the production capacity and financing that matters, he tells NTB.

Russia's assistants

Kazakhstan is one of the countries that appears to be helping Russia circumvent Western sanctions.

After the EU banned European technology suppliers from selling to Russia, exports to Kazakhstan were in line with that. The Economist tripled

Although Kazakhstan has a very modest technological industry, the country's exports of technological products to Russia have increased more than sevenfold over the same period.

About half of exports from Germany to Kyrgyzstan never arrive there at all, Chief Economist Robin Brooks noted, At the American Institute of International Finance research earlier this year.

– Kyrgyzstan is only written on the bill, that's not where it ends. They end up in Russia, he said.

Read also: Putin threatens NATO with war

Electronics and Chemicals

With the European Union imposing new sanctions on Russia, exports from Europe to countries such as Turkey, Armenia, Azerbaijan and Georgia increased by 50 percent from 2021 to 2023.

So did the exports of these countries to Russia.

From 2021 to 2023, Armenia doubled its imports of chemicals from Europe, quintupled its imports of IT equipment, and quadrupled its imports of other electronic devices.

The background is unlikely to be growth in domestic demand. Much of it has been smuggled to Russia. The Economist.

The combined growth of the five Central Asian countries in the Caucasus region reached 4 percent in 2022. The following year it ended at 6 percent.

Armenia's economy grew by a whopping 8 percent last year, and few wonder why.

Read also: – The West is afraid to help Ukraine shoot down missiles

parts of the united states and europe

The EU has imposed a total of 14 sanctions packages against Russia and more than 2,200 Russian companies and actors and bans the export of everything that can be used in the production of weapons and military equipment.

Much of the equipment used by Russian forces in Ukraine still contains parts produced in Europe or the United States, according to Britain's Royal United Services Institute.

One of the missiles used by Russia in the attack on Kharkiv in January was found to have been manufactured in North Korea.

then Experts picked it apart After analyzing 290 different parts, they found that 75 percent of them were manufactured in the United States. 16 percent of the parts came from Europe, while the remaining 9 percent were of Asian origin.

This is despite the fact that North Korea has also been under a strict Western sanctions regime for many years.

Read also: Ukrainian intelligence chief: North Korea's support for Russia is most harmful

Oil and Gas

The Russian economy is also growing thanks to oil and gas exports. Although exports to large parts of Europe have stopped, Exceptions have been made..

With Brussels’ blessing, Austria covered 97% of its gas needs with Russian gas last year. Slovakia imports 89% of its gas from Russia, with Hungary accounting for 47%.

Countries such as France, Spain and Belgium have bought large quantities of Russian LNG. Such imports are not subject to sanctions unless the gas is exported to other countries.

EU Ambition It is to stop all imports of LNG from Russia, but that will happen in 2027 at the earliest.

Only during it Last week in August, Russia exported oil, gas and coal. With more than NOK 50 billion, the biggest beneficiaries were China and India. Turkey, the EU and Brazil came next, despite Western sanctions.

There are no signs that President Vladimir Putin's power is about to weaken. CIA Director William Burns recently admitted.

The same seems to be true of the Russian war economy.

(© NTB)

By Bond Robertson

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