Russia’s economy experienced growth in 2023, thanks to its transition to a mobilized war economy under Putin’s leadership. However, the BBC’s economics editor Faisal Islam warned that the Kremlin would eventually face systemic collapse in the long term.

The Russian state has significantly increased its spending, especially in the military and security sectors, reminiscent of the late Soviet era. This came at the expense of supporting other parts of the population, as funds were diverted to the production of tanks, missile systems and defense in occupied Ukraine.

Despite facing oil sanctions, Russia has managed to maintain its economy, as levels of resource exploitation have remained almost unchanged from the pre-war period. Moreover, the country adapted by using a “shadow fleet” to transport oil to India and China, effectively circumventing the sanctions.

Looking ahead, demand for oil and gas is expected to peak and Russian competitors will increase production, posing a challenge to the Russian economy. In addition, the production of tanks and ammunition is considered an unproductive aspect of the economy. However, while a long-term collapse is predicted by many analysts like Islam

By Editor

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