? The Russian president wants to restore the glory of the vast empire before Gorbachev dissolved the former USSR in the late 1990s. The explanation, given by Putin himself at dawn when he ordered the invasion, embellished with accusations of Nazism against Ukraine, is difficult to understand in Western terms. For him, the creation of the security perimeter around Russia that claims NATO.
The , but the Russian collapsed by more than a third only the day it announced its invasion. Russian per capita income has plunged from €14,000 to around €9,000 a year since the Crimean War, despite the fact that sanctions adopted in 2014 are said to have had little impact. Isn’t Putin afraid of the new sanctions, much more severe than the previous ones?
The well-being of the Russians brings him to the rescue, in reality, as happens to Latin American dictators in the style of Venezuela’s Maduro. He has the support of more than half the population, thanks to a well-oiled and agile propaganda and defamation machine, which will now be in charge of building a tailor-made suit to present him as a victim of the genocidal policies of Ukraine and the West, instead of as an aggressor
How far can you go in your ambitious expansion? No one really believes that Ukraine is going to be annexed after the experience in Afghanistan. Among other things, because it is a country of 40 million inhabitants, with an enormous size for the potential of the Russian economy.
As the Economist reports today, Russia has a GDP of 1.3 trillion, a little higher than ours. Most likely, he will seek a lightning action aimed at overthrowing the Government of Volodomir Zelenski, with whom he is already willing to negotiate, to replace it with a puppet related to his person. What seems certain is that it will take over the republics of Donbas, Donetsk and Lugansk, of which it now only controls a third, to establish an outlet to the Black Sea.
If he succeeds, the next step could be the Baltic republics of Estonia, Latvia and Lithuania, which together have only 6 million people.
The problem is that they are members of NATO and the rest of the Member States would be forced to defend them, not as is the case now with Ukraine. That is why it is important that Europe and the United States remain united and stand firm in applying sanctions against Russia.
The penalty package is aimed at isolating the Russian economy and its leadership as was done in Iran. But it is difficult for him to achieve it, at least in the short term. Putin has carefully prepared the invasion in recent years in order to resist the Western embargo.
Russia . The sales of fossil fuels, which represents 14 percent of its GDP (a percentage similar to the tourism sector in Spain) and 40 percent of its public income, allowed it to accumulate surpluses and foreign currency reserves of 630,000 million dollars, according to the Council for Foreign Relations (CFR).
Its economy is very open, contrary to what is thought. 46 percent of GDP depends on abroad. Moscow has made a turn towards Beijing, where it directs 15 percent of its exports and where one fifth of its imports already come from.
Through the construction of another underground tube, as well as ensuring the supply of strategic goods, especially from the technological and industrial sectors. With this, it will counteract the effect in two of the areas in which the sanctions are focused.
Germany suspended the future Nord Stream II gas pipeline, but did not dare to cut the current gas supply channels, fearing indirect repercussions on banks around the world.
Western sanctions will have a boomerang effect, because they will hurt the United States more. Germany will be the most affected, since it exports 30,000 million dollars to Russia, 2 percent of its foreign trade, and obtains a trade surplus of 11,000 million. A painful blow for a country, which entered a technical recession in the fourth quarter of 2021.
Putin chose a critical moment for his raid. The exit from the Covid crisis is causing tightness in global supply chains and a rise in prices, which will now be accentuated again.
Russia is the source of half of palladium exports, 15 percent of platinum and 4 percent of aluminum. Likewise, it is the world’s leading producer of wheat, the fourth largest oil producer and one of the main gas producers.
All these raw materials became more expensive. Crude broke the hundred dollar barrier, which multiplied its price by seven in the last year. Sooner or later, companies will have to transfer the cost of transport to their customers and to households, which in turn will push for wage increases that feed back into inflation.
The first reaction of the ECB and the Federal Reserve was to try to calm the markets with a message of easing pressure on interest rates, expected in March in the United States and at the end of the year in Europe.
But for how long will it be achieved? If prices continue to rise, and there are more and more arguments to believe that they will, central banks will be forced to increase the price of money to avoid a serious economic crisis.
if inflation in the medium term exceeds two percent. A percentage that is multiplied by three in Spain, where experts predict rates above ten percent in the coming months.
The economy is heading towards stagflation, low growth without inflation. A trend that is confirmed and accelerated after the escalation of tensions in Ukraine. But fortunately, this will not happen immediately.
The ecological transition will suffer. , Europe is obliged to use the ships that arrive from the Middle East and the United States, because the connection with Norway is not enough.
The Iberian Peninsula, which has 8 of the 21 European regasification companies, . In anticipation of events like the current one, the EU has already declared gas and nuclear as sustainable energies, which accredits them to receive subsidies. In Europe we can see a renaissance of small nuclear power plants with which to reduce the cost of energy consumed, at the same time that the rush to achieve the ambitious objectives of reducing CO2 emissions is relaxing.
From the point of view of geostrategy, Russia’s alliance with China, the world’s second superpower with close to 14 trillion GDP, constitutes a real threat to the West. Some speculate that the regime in Beijing could take advantage of the current tensions to launch an attack and take back Taiwan.
For now, these plans are part of fiction. What is certain is that the Russian invasion will contribute to the regionalization of the world economy and the end of globalization, already evident in the term of former President Trump. It will revive the politics of blocs and the cold war born after the Cuban missile crisis in 1962.
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