Continuing the war means the economy faces stagnation, while ending it would shut off the massive defense spending that's driven growth, Alexander Mertens writes.

cross-posted from: https://lemmy.world/post/21521751

Archive Link

Summary

Regardless of Putin’s decision regarding the war in Ukraine, Russia’s economy is facing a crisis due to factors such as sanctions, a shrinking sovereign wealth fund, and a labor shortage. The war has boosted growth, but Russia cannot sustain it without significant economic consequences.

    • ddplf@szmer.info
      13·
      2 months ago

      Sometimes I find myself wondering if spontaneously invading a sovereign European nation with strong ties to the most powerful alliance on earth was all that great decision in terms of economy and wellbeing.

  • zabadoh@ani.social
    5·
    2 months ago

    Q: Will Putin be okay, because he’s the richest man in Russia?

    A: Yes.

    Then war will continue.

    • thanksforallthefish@literature.cafe
      1·
      2 months ago

      Article forgets to discuss how a removal of sanctions due to withdrawing would help alleviate the economic crisis.

      That assumes sanctions would be quickly removed. Given the massive list of war crimes Russia has committed in UA I sincerely doubt many in the West are lifting sanctions before the offenders are punished - something Putin is unlikely to agree to.

      It is a catch22 because that gives him limited reasons to withdraw. Russia are very much in “crash through or crash” mode now because they see no way out and still hope the west will withdraw support.

      To answeryour question. Withdrawal of sanctions will remove some pressure points - improved revenue by being able directly sell fossil fuels and thus getting a higher price per barrel; ability to buy critical components such as aviation parts and ICs. Most importantly China will be able to buy significant major assets and invest (they’re avoiding overt help to avoid sanctions themselves)

      That will take significant time to make a difference though, the decimation of the workforce will still be an issue. Russia will become a Chinese serf regardless of whether they retain Ukrainian land or withdraw completely. Their economy is now in such a bad state their only hope is a rescue by China. One which will be priced at firesale “cents on the dollar” prices