The West’s sanctions against Russia only harm the West – that’s what the Kremlin says. According to economists, however, statistics speak against it.
After six months of war, Western sanctions are leaving their mark on the Russian economy. At least that’s the conclusion reached by a team from the renowned Yale University. Contrary to the claims of the Kremlin and critics of the sanctions, these are by no means “ineffective” or “disappointing” but have a “crippling effect on the Russian economy,” write the economic experts from the US university’s Chief Executive Leadership Institute.
“Russia’s strategic positioning as a commodity exporter has irrevocably deteriorated,” […] since it has lost its former main markets.” Imports have “largely collapsed” and the country is facing major challenges in sourcing key replacement parts and components, “leading to far-reaching supply shortages in the domestic economy,” writes the Yale University team Despite Putin’s claims of a self-sufficient Russian economy, “Russian domestic production has come to a complete halt, lacking the capacity to replace lost businesses, products and talent.”
Russian economy loses due to sanctions
According to the researchers at Yale University, Russia has lost 40 percent of its gross domestic product as a result of the withdrawal of companies, “which has wiped out almost all foreign investments of the last three decades”. For Russia there is no way out of the economically precarious situation as long as the allied countries maintain and increase the sanctions pressure against Russia. “Defeatist headlines claiming that Russia’s economy has recovered are simply not true,” write Yale’s economists.
The Eastern Europe expert also came to the same conclusion in an interview: “The Russian economy shrank by around 6.5 percent from February to June 2022.” However, the effect of the sanctions is distributed very unevenly. “In some sectors of the Russian economy, such as aviation or the automotive industry, almost nothing is working at the moment.” Consumption has also collapsed. “But the oil business is still booming and even the little gas that is still being supplied brings in a lot of money,” says Kluge. That’s why the national budget is still relatively healthy, “despite the expenditures for the war and large aid packages that have to be put together because of the sanctions.”
“Russia is getting much poorer”
Kluge is certain: “The Russian economy can never completely replace cooperation with the West. Russia will therefore become significantly poorer and technologically more backward in the coming years.”
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Source: Stern
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