Russia has been waging war against Ukraine since February 2022. And it costs money. A lot of money. President Vladimir Putin uses drastic means to finance the war – and therefore to harm the Russian economy in the long term.
It has long been known that Russia uses expropriations by companies and war critics to rinse money to health insurers. A report now also shows how lucrative this procedure is. In the past three years, the Russian authorities have seized assets of companies worth around 43 billion euros. This is demonstrated by an analysis by the Nectorov law firm, Saveliev & Partners in Moscow.
In the past twelve months alone, the value of the confiscated assets tripled. The law firm had a total of 102 cases of expropriations. The authorities have their sights on both Russian and Western companies. The Austrian OMV was also one of the companies involved. Russia had seized shares that the OMV had in a gas financing project in Siberia and transferred to Russian companies.
But Russian companies are no longer really protected. According to Bloomberg, the reasons for expropriations, such as corruption or accusations of extremism, are mentioned.
Equipment washes money in the treasury
The expropriations do not pass the Russian economy without a track: on the one hand they can strengthen state finances and increase the power of the state. On the other hand, the confiscations weaken the economy, especially the private sector, as stated in a Bloomberg report.
Income from gas and oil broken into
Economists Andrei Yaklovlev is sure that the expropriations will reduce the economic performance of Russia. However, untrusting are an attractive business model for the Russian authorities – they can later resell the expropriated companies that entail money. Yakovlev estimates that “at least half of all regional entrepreneurs” should expect expropriation.
Despite countless sanctions, the Russian economy is better over water than expected in the war, but it still squeezes: the income from oil and gas was separated in June with a third, the interest is at a very high level, experts warn of a debt crisis and US President Donald Trump recently struck hard tones. “We get a lot of nonsense from Putin,” Trump said in the White House.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
