Russia is preparing for a long war
Alles anzeigen[...] The nation’s finances have inevitably been influenced by the war and the upcoming elections. Despite problems at the start of the year, things have improved in recent months. The budget deficit fell from its April peak of 3.4 trillion rubles to 2.6 trillion at the end of June. In addition, economic growth has led to a rise in non-energy taxation revenue and spending fell. Finance Minister Anton Siluanov has promised the annual budget deficit will not exceed 2.5% of GDP, but there is still a high risk that it will increase above its current level.
In 2024, we expect some tweaks to expenditure. But any major cuts seem impossible: not just for political reasons but because state spending – primarily military spending and social handouts — are driving economic growth and rising salaries (you can read more about this here). On a structural level, the war is now an integral part of the country’s economy. Even if the conflict in Ukraine transitions from an active war to a more frozen conflict, Russia’s military spending is extremely unlikely to decline. [...]
Western sanctions mean the Russian economy is securely insulated from global shocks. If there is no sudden fall in oil prices, or anything similarly catastrophic, there is enough money to maintain current spending for about two years.
The Russian economy is set to completely reverse last year’s slump – something Putin has recently highlighted. Manufacturing and construction lead the way, alongside retail. In a broad sense, all three sectors are beneficiaries of the war. The defense sector, working in three shifts, is boosting production: in June, for example, the biggest increases were in finished metal products (+45.8% year-on-year); computers, electronics and optics (+71.6% year-on-year), radar equipment (+75.4% year-on-year) and electrical equipment (+32.1% year-on-year). Production capacities are running at their maximum.
Construction is primarily driven by discounted mortgages: currently, 51% of loans come with state support, up two percentage points since April. Overall, the mortgage portfolio of Russia’s top 20 banks was up 3% in May. In addition, construction continues on occupied Ukrainian territory. “In the first half of the year, 20 apartment blocks were built and more than 2,000 were restored. More than 150 public buildings, plus more than 1,000 residential and community objects. Federal contractors restored 260 kilometers of roads,” Deputy Prime Minister Marat Khusnullin said recently. These projects, along with the construction of massive defensive fortifications on the frontline, even led to a shortage of cement.
Retail growth has been driven by increased salaries and social handouts (some of which are connected to the war). Real incomes are up in regions that are home to military factories and where reports suggest there are large numbers of contract soldiers (for example, Buryatia, the Jewish Autonomous Okrug and Chechnya). Double-digit wage growth masks one of the biggest barriers to economic growth — a shortage of labor. A lack of workers and limits on production capacity lead to what economists call an “overheated economy”: supply cannot match rising demand, and prices increase accordingly. To cool down the economy, the Central Bank may be forced to further increase interest rates.
The distribution of demand via military expenditure encourages the Kremlin to drag out the war as long as possible. Or to start a cold war in place of the current hot one. All indicators suggest that this is what is happening: economically and legally, the Russian authorities are weaving the war in Ukraine — and more generally the struggle against the West — into the fabric of public life. However, the more the economy binges on military expenditures, the greater the hangover. In political terms, “eternal war” is increasingly becoming a cornerstone of the Kremlin’s narrative. Putin has no other vision to offer. [...]
Interessanter Nebeneffekt der westlichen Sanktionen: Durch die weitgehend Isolation von den volatil(er)en westlichen Finanz- und Rohstoffmärkten hat sich die russische Wirtschaft mitten in der globalen Wirtschaftskrise relativ stabilisiert und wird zudem von einer Art Kriegs-Keynesianismus massiv vom Staat gestützt, während sich Europa unter deutscher Führung in alter Tradition gerade wieder ganz beherzt noch tiefer in die Krise hinein sparen will.
Laut Einschätzung der Autorin bleibt Putin und der russischen Elite eigentlich gar keine andere Wahl, als den Krieg noch möglichst lange weiter zu führen - sofern die Russen dabei keine allzu hohen Verluste an humanen Ressourcen mehr erleiden - oder ihn in einen echten kalten Krieg samt permanentem Rüstungswettlauf zu transformieren, weil die nun von der Kriegswirtschaft abhängig gemachte russische Industrie sonst auf kalten Entzug gesetzt, und in die Depression schlittern würde.
Hinzu kommt, dass die politische Führung den Kampf gegen die westliche Bedrohung längst zum Kern der Staatsräson und nationalen Sache gemacht, und den noch politisch interessierten Teil der Bevölkerung größtenteils darauf eingeschworen hat.
Wenn das so stimmt, dann hat der Wertewesten mit seiner hirnlosen Reaktion auf den russischen Angriffskrieg tatkräftig dabei mitgeholfen, sich genau die Sorte eines systemischen Erzfeindes (wieder) zu erschaffen, zu dessen Abwehr die NATO ursprünglich gegründet wurde. Wenn "wir" jetzt noch den USA in das pazifische Abenteuer folgen ist der geopolitische Zirkelschluss vollendet.
