Putin's Unsustainable Spending Spree: How the War in Ukraine Will Overheat the Russian Economy
Category: News & PoliticsVia: jbb • one month ago • 1 comments
By: Alexandra Prokopenko (Foreign Affairs)
The Russian economy's problems, in fact, are such that Putin is facing an impossible trilemma.
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Putin’s Unsustainable Spending Spree
How the War in Ukraine Will Overheat the Russian Economy
January 8, 2024
After Russia invaded Ukraine in 2022, its economy seemed certain to suffer as a coalition of Ukraine’s allies, led by the United States, imposed an unprecedented program of sanctions. Many figures, including U.S. Treasury Secretary Janet Yellen and EU Sanctions Envoy David O’Sullivan, predicted that these would force Russian President Vladimir Putin to choose between the war and a struggling economy. But Russia’s economy has defied these predictions. Thanks to record state spending, the Russian economy will grow faster than the global economy in 2023. Whereas the latter is forecast by the IMF to grow by three percent.