How Russia Is Surviving Western Sanctions

Despite uncertainty in the world economy and sanctions, Russia’s economy is set for a broad-based economic recovery. Policies to boost public spending, notably investment, should contribute. In this presentation and discussion, Martin Gilman explored why the Russian authorities have been able to marginalize the impact of the U.S.-instigated sanctions. Gilman underscored how the most recent legal case involving Baring Vostok could have a much more chilling effect on economic prospects.

This event is part of the DMGS-Kennan Institute Distinguished Speaker Series, which hosts scholars and practitioners in the Russian and Eurasian spheres.

Selected Quotes

“Most Russians that I am familiar with consider that sanctions are a permanent feature of life in the foreseeable future – perhaps even longer than the Jackson-Vanik Amendment. It’ll just be part of life. As a consequence of that, they have taken steps to reorient the economy and make it more resilient. No doubt, there is cost involved, but the Russian economy will continue to cope.”

“People just hold enough ruble money for current transaction. They don’t hold rubles as an instrument of savings or investment, and that has always been very worrying for me. Any country where people do not want to hold its own currency – you have to ask yourself a lot of questions.” 

“[The sanctions have] created a siege mentality – circle the wagons. Russians are patriotic, just like we are here, and so they generally see that if they’re being ganged up on by some of the major countries, they push back. What I consider really the dangerous problem is that by sanctions, the kind of ‘good guys’ in Russia… are being effectively marginalized.” 

“I don’t see anything that’s going to stop [sanctions] on the Russian side; I don’t think that they’re going to change policies consciously because of sanctions. They may change policies for other reasons.”