(October 25, 2024 at 1:03 am)Fake Messiah Wrote: Russia is on the verge of collapse. Europe cannot abandon targeted sanctions
There is an urgent imperative for European countries to make the sanctions regime against Russia more airtight. The IMF just raised its forecast for Russian GDP growth in 2024 from 3.2 per cent to 3.6 per cent. Yet the outlook for the Russian economy in 2025 looks much bleaker. The IMF just slashed its GDP growth projections from 1.5 per cent to 1.3 per cent next year. Even though Russia’s interest rates are at 19 per cent and soaring, inflation remains stubbornly high at 8.6 per cent.
As key sectors of its civilian economy stagnate, it is more reliant than ever on its bloated military budget to sustain growth. Even in the defence sector, Russia has 400,000 fewer workers than it needs and severely lags many industrial economies in automation. A combination of labour shortages, rising prices and foreign capital flight could lead to the bursting of Russia’s defense-industrial boom in the coming year.
Tighter sanctions would make Russia’s economic outlook even more pessimistic and raise the costs of its aggression against Ukraine. Europe needs to present a unified front against Russia’s shadow fleet of oil tankers and front companies that do Russia’s bidding.
https://www.telegraph.co.uk/news/2024/10...sanctions/
Another point to consider is that in terms of domestic economy, military spending is largely unremunerative. When you spend millions of rubles on artillery shells, sure, you ramp employment and GDP in raw numbers. But military spending is not investment. That is money literally thrown into the fire. When your economy is under sanctions, the inflow of foreign currency is curtailed, meaning that money spent on making bombs and shells and missiles to be discharged bring you no further income.
Internally, the Russian economy may last a while, but it's not much different from the German economy in 1938 -- overheated, producing "goods" with no return on investment until your troops sack the nation you're attacking.
It follows that the longer Ukraine holds out, the more the Russian economy goes on a diet -- and the more precarious is Putin's position. Even if they win in Ukraine, they've already destroyed much of the industrial base that could ostensibly offset the "investment" of their invasion.
