“Decree on mobilization Putin brings the war to the home of the Russians and plunges the economy into a real catastrophe ” – says Russian economist Władysław Inozemtsev, director of the Moscow-based think tank Center for Research on Post-Industrial Studies at the Russian Council on International Affairs (RIAC).
“The Russian economy will be dead until winter, I wrote in early March” – Inozemtsev recalled on the Russian website The Insider, quoted by fortune.com. “Now I think I was right. The mobilization announced on September 21 was a milestone that divided Russian history into “before” and “after”. This is the event that started the final countdown of the Putin era“ – added.
Russia’s GDP will fall much faster
Before Putin’s mobilization decree, Russia’s GDP was forecast to decline by about 4-5 percent this year, with Inozemtsev’s agreement. Now he believes that Russia’s GDP will fall by as much only in October, and that the following months will only consolidate the trend. “Now my spring forecast of a 10% decline seems too optimistic” – the economist concludes.
The Kremlin’s emphasis on mobilization and hostilities means government funds will be channeled into these initiatives at the expense of investment in business and the economy. “Investments in business will start to decline sharply, and Moscow Stock Exchange could fly below 1,500 points before the end of the year” – wrote Inozemtsev. “And all this does not take into account the inevitable new the wave of Western sanctionsto be announced in the near future ” – added.
Inozemtsev believes that in the next few days, army representatives will start handing out recruitment documents in workplaces. This, in turn, will induce many to quit or not show up at work to avoid being called. In his opinion, the loss of even a few employees of companies in large cities may cause disproportionate damage to the economy. “Russia is the economy of big cities and companies” – assessed.
In poorer regions of Russia, such as Buryatia (Eastern Siberia), “thousands of families will be left without income, and local medium and small businesses will simply die out” – assesses Inozemtsev.
First decree since WWII
On September 21, Putin announced a “partial” mobilization, the first Russian mobilization decree since World War II to redirect 300,000 jobs. able-bodied men aged 18 to 30 in military reserves to fight in Ukraine. Putin’s decision to mobilize triggered massive protests.
Several reports from independent media publications indicate that the Kremlin probably intends to recruit more than 1.2 million men to fight in Ukraine, but Kremlin press secretary Dmitry Peskov has denied this.
Source: fortune.com, theins.ru