February 24 marks two years since Russia launched a full-scale invasion of Ukraine. War is costly, and now it is having consequences for the Russian economy. – Russia has the money to maintain the war in the short term. But now the leaders face painful trade-offs. Underinvestment, low growth and unemployment will only increase. This is how the US Treasury describes the situation for the Putin regime. Last year, the Russian economy grew more than most Western economies, according to the International Monetary Fund (IMF). Value creation in Russia increased by 3 per cent last year. The country, on the other hand, is struggling with high price growth. On Friday, the United States adopted sanctions against what were referred to as “500 Russian targets”, according to Reuters. The Russian economy has struggled with low growth, but still manages to maintain the war. Photo: MAXIM SHEMETOV / Reuters Companies, people and companies are affected by the several hundred sanctions. The reason is Russia’s warfare in Ukraine, but also the death of Alexei Navalny. The military industry is particularly affected. The measures are also aimed at businesses in countries outside Russia, which assist the regime in bringing in essential goods. The sanctions are also aimed at the Mir payment system, Russian financial institutions and their military industry, as well as the country’s energy production. The White House will also target those who were individually involved in the imprisonment of Navalny. – Sanctions and export controls are meant to slow down Russia. It will make it harder to fight the arbitrary war in Ukraine, says Deputy Finance Minister Wally Adeyemo. The Ministry of Finance adopted sanctions against 300 persons and entities, and the Ministry of Foreign Affairs against over 250. The Ministry of Trade also listed 90 companies on the US’s “Entity List”. There is a list of companies that threaten the security of the country that are subject to strict restrictions. – Russia has been creative in finding loopholes. We see, for example, that trade from the West to former Soviet states has skyrocketed, says Palle Ydstebø. He is a head teacher at the Military Academy, and believes that Russia is dependent on other ways in. – Remains of Western high technology have been found in between Russian and North Korean rockets, as well as in Iranian drones, says Ydstebø. Palle Ydstebø, head teacher at Krigsskolen, says that the sanctions affect Russians with a low standard of living. Photo: Emma-Marie B. Whittaker / news Support from the EU and Norway Along with punishment for the Ukraine war, the US wants to hold Russia responsible for the death of regime critic Alexei Navalny. On Wednesday, the European Union adopted new sanctions against Russia. The package, which is one of the broadest so far adopted by the EU, is the 13th in a row. Norway has largely joined the EU, which means that the government calls the sanctions against Russia “comprehensive”. Palle Ydstebø believes it is important to have a greater breadth in the sanctions measures. – If one also uses the back channels into Russia, it will probably help, he says. Sergey Lavrov, Russia’s foreign minister, has seen many European politicians on the list of those who cannot enter Russia. Russian Foreign Minister Sergey Lavrov says that the sanctions from the EU are illegal, reports the Russian news agency Tass. Lavrov announced on Friday that they have seen many European politicians and EU representatives on the list of those who cannot enter Russia following the sanctions. Better than expected The Russian economy has for a long time been tried to be strangled by a series of sanctions. In 2022, the first year of full-scale war in Ukraine, the economy shrank 2.1 percent. The US Department of the Treasury claims that there are three forces that are working together to damage the Russian economy. The first is the expenditure for the war itself, sanctions from the USA and other countries, as well as Russia’s urgent countermeasures against the sanctions. On Thursday, US President Joe Biden met the wife and daughter of the late regime critic Alexei Navalny. Photo: THE WHITE HOUSE / Reuters – As a result, the Russian economy is turning from private consumption to defense spending. It is at the expense of the Russians. They will experience a long-term decline in living standards, writes the Ministry of Finance in a report. – The sanctions are already affecting people with a low standard of living. There are especially people in the Russian countryside, especially in the republics, which have a large proportion of the non-Russian population. There it is still desirable to enlist to go to war for Russia, says Ydstebø. The economy, on the other hand, has done better than expected. The IMF estimates a growth in Russia’s gross domestic product (GDP) of 2.6 percent. It is 1.5 percentage points higher than what they expected in October.
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The US will force Putin’s war economy to its knees – news Urix – Foreign news and documentaries
