Torbjörn Becker

Den 24 februari 2022 attackerade Ryssland, oprovocerat och i strid med internationell rätt, Ukraina. Denna attack var en eskalering av det angrepp som började redan 2014 med annekteringen av Krim och krigföring i östra Ukraina. Det fullskaliga kriget har snart pågått i tre år och har, oavsett vad som händer i närtid, förändrat säkerhetsläget i Europa för lång tid framöver. Västvärldens tydliga respons med omfattande sanktioner mot Ryssland samt militärt och ekonomiskt stöd till Ukraina indikerar att de flesta inser att Rysslands agerande är ett hot inte bara mot Ukraina utan hela den demokratiska världsordningen. I detta sammanhang är det centralt att förstå att i en militärkonflikt är relativ styrka avgörande, därför är sanktioner mot Ryssland och stöd till Ukraina ömsesidigt kompletterande insatser. Ansträngningarna måste syfta till att både minska Rysslands förmåga att föra krig och samtidigt stärka Ukrainas motståndskraft.

On 24 February 2022, Russia launched an unprovoked attack on Ukraine, in clear violation of international law. This aggression represented an escalation of the conflict that began in 2014 with the annexation of Crimea and the onset of warfare in eastern Ukraine. The full-scale war has now persisted for almost three years and, regardless of near-term developments, has permanently altered Europe’s security landscape. The unequivocal response from the West—with extensive sanctions imposed on Russia alongside significant military and economic support for Ukraine—demonstrates a widespread recognition that Russia’s actions pose a threat not only to Ukraine but also to the entire democratic world order. In this context, it is crucial to understand that relative strength is paramount in any military conflict; thus, sanctions against Russia and support for Ukraine are mutually complementary efforts. These measures must be directed simultaneously at reducing Russia’s capacity to wage war and at bolstering Ukraine’s resilience.

This report was commissioned by the National Institute of Economic Research (NIER) from the Stockholm Institute of Transition Economics at the Stockholm School of Economics (SITE) to analyze the Russian economy in the shadow of Russia’s war against Ukraine. The analysis includes a background of how the Russian economy worked before the war, detailing how important international oil prices changes have been for economic growth. It also provides a description of the political economy of the Russian economic system and what the trade patterns were prior to 2022. The report then focus on a wide range of economic indicators as reported by Russian authorities and discuss how this is now part of the Russian war propaganda. This includes indicators of fiscal and monetary policy, trade, reserves and the financial system. Inflation and economic growth are particularly important components of the propaganda narrative, and the report provides a critical review of official statistics for these key economic indicators. It also provides some alternative measures of inflation and growth that paints a very different picture of the Russian economy compared to the official numbers. Since the start of Russia’s war against Ukraine, the Western coalition that support Ukraine have introduced sanctions with the aim to restrict the resources available to Russia in waging this war. The report details these sanctions and how they impact the Russian economy. The sanctions have a direct bearing on the medium and longer-term outlook for the Russian economy, including on fundamental growth factors and the increasing risk of a full-blown economic crisis in Russia which is discussed in a separate section in the report. The report ends with a concluding section that summarizes the main ideas of the report. It then also adds a rich list of reference for further reading and analysis for the interested reader as well as an appendix that provide a more comprehensive timeline of the sanction that have been introduce so far.