The EU has warned Russia that it will face “massive” economic consequences if Moscow decides to invade Ukraine. But Russia has weathered sanctions before and the country appears resilient to the economic pain inflicted by the West – especially when China is ready to lend a helping hand.
The build-up of more than 100,000 Russian troops on the Ukrainian border has seen EU leaders debate a raft of sanctions ranging from disconnecting Russia from the SWIFT system of international payments to the imposition of sanctions on more oligarchs.
But Russia is already heavily sanctioned. Following its 2014 annexation of Crimea, the West imposed massive sanctions, including finance and trade restrictions and a ban on assistance to Russian oil and gas companies. They however failed to contain President Vladimir Putin's ambitions in Ukraine.
“Russia will weather the new sanctions in the same way it has since 2014, when the West imposed visa restrictions and asset freezes on Russian officials over the Ukraine crisis. The sanctions imposed on Russia over the years have proven to have very little effect,” said Anastasiya Shapochkina, a lecturer in geopolitics at Sciences Po, in an interview with FRANCE 24.
If anything, Shapochkina maintains, “Russia has been emboldened, because it speaks the language of machine guns, not the one of economic sanctions”.
The interdependence of the Russian and EU economies makes it difficult for the bloc to slap economic damage on Russia without hurting itself, according to some experts.
“The EU would be shooting itself in the foot by imposing sanctions on Russia because companies like Total, Engie, Areva, Danone have heavily invested in Russia for decades, and they would suffer if relations were severed,” said Shapochkina.
The Achilles heel of Putin’s presidency may well be inside Russia. Low purchasing power, rising food prices and inflation mean that Russians have a low appetite for military action abroad. “Only 16 percent of the Russian public approves of an invasion of Ukraine,” noted Shapochkina. While the country has been grappling with massive internal problems, including public health and economic crises, state newspapers concentrate on foreign issues like Syria and Ukraine, she explained.
The turmoil of the 90s
Russia is nearing the 30th anniversary of the dissolution of the Soviet Union, which occurred on December 26, 1991. The economic woes of today seem slight compared to the turmoil of the 1990s, when Russia violently careened from communism to capitalism and many citizens fell into poverty.
According to Vladimir Fédorovski, a former Russian diplomat of Ukrainian origin, “Russians have a huge capacity for resilience. They accept the fact of being resilient with a war-like posture, while the West is less likely to accept a war.”
Fédorovski divides Russian public opinion into three categories. “The first, associated with neo-Stalinism, is that Russia should be self-sufficient and that sanctions are positive since they force Russia to survive by itself,” he explained.
The second category, which Fédorovski calls “the traditional one", believes contact with the West should be renewed and dialogue should be maintained.
The last group of pro-West Russians is "largely discredited because it is associated with Boris Yeltsin’s presidency (1991-1999), when the interests and assets of the former Soviet Union were sold out to the West,” he explained. That period is widely considered the worst period in Russian history, a sentiment Putin has embraced when he frequently refers to the collapse of the Soviet Union as "the greatest geopolitical catastrophe of the century”.
An old joke in Moscow policy circles is emblematic of the problems confronting Russia. It goes like this: Sometime in the mid-1990s, Britain's then prime minister, John Major, asked his Russian counterpart, Yeltsin, to characterise the state of the Russian economy in one word. Yeltsin responded: “Good.” Seeking greater detail, Major asked Yeltsin if he could describe it in two words. Yeltsin responded: “Not good.”
The joke illustrates the current situation in Russia: While the Russian central bank is in control of inflation, and the macroeconomics are stable, growth is hampered by internal corruption and Moscow’s isolation from the rest of the world.
NATO expansion
“The biggest error of the West since the fall of communism,” said Fédorovski, is “failing to integrate Russia into the international system, and failing to consider Russia’s objectives. When the West claimed itself as victorious in the Cold War, this contributed to Russian people’s cynicism towards the West. Later, Putin used petrol for the renaissance of the country,” he explained.
The expansion of the North Atlantic Treaty Organization (NATO) remains an existential threat for Putin, explained Fédorovski. “Russians consider the conflict with Ukraine to be conceived by the West in order to destroy Russia. With the West having transformed the Ukrainian army, Ukraine can now operate a blitzkrieg on the Donbass and hope that Putin won’t react. But of course, he will be forced to act if the Ukrainians attack.”
The lack of economic growth in Russia, combined with isolation from the West, is likely to have two consequences: A renewed era of tensions between Russia and the West, which could manifest into a show of force on the ground, and Russia precipitating itself into an alliance with China. The feeling that the surrounding countries of the former Soviet Union still belong to Russia prevails among the Russian people. There is upheaval in many countries on the Russian periphery: Belarus, Ukraine, Georgia, Kyrgyzstan, Moldova, Azerbaijan and Armenia. A common Soviet aphorism is “All ex-Soviet countries are unhappy in their own way”, and Russia is no exception to the rule.
