How Putin's decisions are damaging Russia's economy
Russian economist Vladislav Inozemtsev stated in an interview with Glavcom that President Vladimir Putin's own policies are inflicting greater damage on Russia's economy than Western sanctions. According to Inozemtsev, the consequences of Kremlin actions pose a far more serious threat to the economy than any external factors. He pointed to a recent attack on an oil terminal in Tuapse, which effectively ended the Caucasus resort season that millions of people had been counting on. This, the economist argued, will lead to business closures and a drop in tax revenues across the region.
Economic strain and rising public discontent
In the interview, Inozemtsev remarked:
'In essence, Putin is killing the Russian economy. The effect of Western sanctions has been compounded by the effect of his own madness. Today, that madness is far more dangerous for the Russian economy than any external factors.' - Vladislav Inozemtsev
He also highlighted that explosions at military enterprises, such as gunpowder factories, while significant for the defense industry, have little direct impact on ordinary Russian citizens.
The Kremlin traditionally monitors public opinion and relies on survey results rather than election outcomes. 'In the Kremlin, they don't even focus on election results, which can be rigged; they focus on polling data. If the public is ecstatic about the annexation of Crimea—great, then the decision to seize Crimea was correct. But now, the Kremlin sees that the Russian population no longer supports the war,' Inozemtsev noted.
He further believes that Russia's fuel crisis will not leave the army without gasoline, but fuel shortages could intensify domestic discontent among Russians and affect the country's political landscape. According to the expert, shifts in the economic situation could thus have serious repercussions for Russia's socio-political climate.
Inozemtsev's comments underline the critical state of the Russian economy. The negative fallout from Kremlin policies may fuel social unrest, which in turn could threaten the stability of the regime. As public satisfaction with the political course wanes, the situation could escalate if economic troubles continue to deepen.
Inozemtsev's insights highlight the complex dynamics of Russia's current situation, where internal policies are increasingly at odds with public sentiment. This mirrors the broader geopolitical landscape, where strategic actions by Ukraine are seen as essential for compelling a reaction from the Kremlin. Understanding these interconnected factors is crucial for grasping the evolving economic and political challenges facing Russia.