NEWNow you can listen to Fox News articles!
Milan, Italy – The editor of one of Russia’s most respected independent economic journals is reluctant to admit that Putin’s team is handling the sanctions storm well.
“We had some data released for the first half of 2022 and the overall feeling is much more optimistic than in March or April,” Petr Mironenko of The Bell told Fox News.
“We see numbers. They are not manipulated. On the one hand, we see economic downturn in the second quarter. GDP fell by about 4%, and in the third quarter we will have about 7%. This is a recession. But the scale is much more modest than it was talked about three or four months ago.”
And less dramatic than in 2009, when there was no war; it is also less than the initial forecast by the Central Bank of Russia of an 8-10% decline in GDP this year. And that is not all. family income according to Mironenko, decreased by only 0.8%. Now even deflation. Some people are simply frightened by the political situation and forced to spend less, saving for an even rainier day.
There are fewer foreign goods, which is why some Russians write it off, but in fact, imported goods can still be bought – between brokers and the surprisingly strong ruble, Mironenko says an iPhone will cost you almost as much as a regular one. a year ago. He himself was shocked to hear about it when he recently bought one for his father.
The government, he says, has wisely avoided price controls, even if everything else they do is like going back to the USSR. Unemployment is at historic lows. Some of them are artificial. The government has raised pensions and wages since the war started because it can.
“Sanctions have not reduced the income of the Russian budget from oil exportit means the government has money,” said Mironenko, who recently went into exile because of the enormous pressure on the press.
“He will have (money) in 2022 and 2023, and as we know, historically Vladimir Putin’s government has also been very good, very cautious about people’s personal income. His whole “legend of prosperity” is based on the constant increase in people’s personal incomes. … Since 2000, it has been very linked to rising oil prices.”
But in any case, Mironenko adds, Putin must support this project of prosperity, and as long as Moscow has the funds, it will spend them on keeping the Russians in the black.
How much will it be, I ask Mironenko? He acknowledges that sanctions work in theory, but says: “It’s a long process. Historically, there are not many examples where even the toughest sanctions do their job in a year. the consequences are a change in policy within three to five years.”
The energy dance is not easy, according to Mironenko, who explains that oil is more important than gas for the Russian treasury, so in a sense it is a commodity to play with.
Vladimir Putin launched a game to cut gas supplies to Europe, ostensibly to see if that would make Brussels nervous enough to ease sanctions. A pain that seems to be worth enduring for now. But when European ban on Russian oil begins at the end of the year, there could be a real outbreak of disaster in Russia, and Mironenko will be watching this moment closely.
Meanwhile, when it comes to public opinion, it’s not just the propaganda crowd in Russia who blames the West for all the woes they’re experiencing, even if the economy is, for the moment, blatantly – if perhaps artificially strong. It is more difficult to have a life connected with the outside world, and for many educated and democratically minded Russians this is vital.
Mironenko says there is a lot of anger among those who feel shut off from the West, as well as a lot of debate about how and where to live morally. Thus, despite the fact that the economy may be quite solvent at the moment, soul-searching and anxiety are dragging many Russians down.