Putin: West’s sanctions have ‘achieved certain results’ on Russian economy

Russian President Vladimir Putin said Tuesday that Western sanctions have “achieved certain results” in impacting the Russian economy but projected defiance about the Kremlin’s war in Ukraine.

The Russian leader said during a press conference that the U.S.-led global sanctions campaign is a “blitzkrieg” that has “achieved certain results” and said Moscow “had to increase the interest rate of the central bank to 20 percent” but that it had gone down in recent days, according to remarks translated by state-owned media outlet RT.

Global economists say that the Russian government is exercising creative technocratic skills to stabilize the Russian currency and economy amid an unprecedented campaign of sanctions, but that it is unlikely to be able to withstand a large-scale economic contraction in the long run. 

Rachel Ziemba, a fellow at the Center for a New American Security, wrote in an article for Barron’s that “Russia’s seeming financial resilience, particularly when it comes to the ruble, is a kind of mirage.” 

Former Russian Finance Minister Alexei Kudrin was quoted by state-owned media saying that the country’s economy is on track to contract by 10 percent in 2022, the biggest decline in gross domestic product since emerging from the Soviet Union in 1991, Reuters reported.

Putin, who made his remarks during a press conference alongside Belarusian President Alexander Lukashenko, also conceded that the Russian government needed “to allocate more resources … in the current situation” to support the economy, but touted working with countries that have not joined the U.S.-led sanctions regime.

“The economy will adapt to the new environment, make no mistake. If you can’t export to one country there’s always a third country. If you can buy something in one country, there is also a fourth country where you can get this, this is inevitable … a single country cannot dominate the world anymore.”

Putin also threatened the global food supply, criticizing Western nations stating that “if they cannot work with us effectively, there will not be enough food on the global markets.”

The United Nations and human rights groups have raised concerns that Russia’s fighting in Ukraine, combined with the sanctions, has interrupted global deliveries and increased the price of wheat and fertilizer and that impacts 1.2 billion people.

“These prices are continuing to grow and this is all attributable to the mistakes by the Western countries,” Putin complained. 

“If our Western partners worsen the situation in financial terms, in terms of insurance and sea shipments, the situation will get worse, including for them. High prices on food and these problems will lead to hunger in many areas around the world and this will lead to more migration flows including towards Europe.”