a Twitter thread from @Aaronal16

1.

Interesting article on how Russia has been able to both dodge economic catastrophe+repurpose their economy despite sanctions. Traders in more RU friendly countries help them get restricted goods & ⬆️ trade with China,India & Turkey is replacing the EU. https://www.economist.com/europe/2023/02/04/russias-technocrats-keep-funds-flowing-for-vladimir-putins-war

2.

According to the IMF, Russian GDP only contracted by 2.2% in 2022 against early western estimates of a 10% collapse made in the Spring of that year. In addition, the IMF predicts the Russian economy will grow by 0.3% this year, higher than both Germany & the UK.

3.

The piece mentioned how Russia was dealing with the $350B of European+American investments in RU. A decree passed when the war started forces western companies closing down operations to obtain a permit & sell at govt determined prices (a discount of 50%+ of their market value).

4.

This has given an opportunity for some Russians to get very wealthy very fast (& binds them closely to Putin). Even some westerners are buying at firesale prices as big western companies leave the Russian market. This new business class benefits handsomely from current RU policy.

5.

According to the economist, the package of extreme measures by RU technocrats to stabilize the economy “have succeeded far better than their authors might have hoped”. These technocrats were able to 1.) control inflation; 2.) prevent an economic crisis &; 3.) stop a bank run.

6.

In addition, RU was able to increase spending by 7 trillion rubles(₽)in 2022 according to Natalia Zubarevich (economist at Moscow State Univ). Of this ₽2.5T went to pensions, additional pronatalist child allowances & cheap loans & a whopping ₽5T (~$66B) for military spending.

7.

Lower prices for oil and gas towards the end of 2022 and so far in 2023 have definitely hit Russia’s income stream but less than many had hoped. However, the piece interestingly mentions that the large discounts on RU oil to India, China & Turkey small be smaller than reported.

8.

Article closes by stating RU is indeed moving rapidly towards a war economy.Production at the Uralvagonzavod tank plant has grown so rapidly they have drafted in at least 300 prisoners to fill orders. In addition to the economy society is being militarized as well.For a long war.

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