4 Facts About Russia’s Economy Being Bombarded by Western Sanctions, Instead It’s Developing

JAKARTA – Russia’s economy is currently in the spotlight after receiving many sanctions from the West. The reason is that the effectiveness of these sanctions is still being debated because until now Moscow’s economy has not only been able to survive, but has even developed.

Recently, United States (US) President Joe Biden announced sanctions against 500 Russian companies with the aim of targeting the financing of the Russian war machine. Export restrictions will be imposed on nearly 100 companies or individuals to limit Russia’s ability to produce weapons.

These sanctions do not include sanctions imposed by the West since Russia began invading Ukraine in 2022. Britain and the European Union, along with other countries including Australia, Canada and Japan, have implemented more than 16,500 sanctions against Russia.

About 70% of Russian banks’ assets were also frozen, according to the European Union, and some of them were kicked out of Swift, a high-speed messaging service for financial institutions. The aim of imposing these sanctions is to weaken the Russian economy.

Reporting from the Carnegie Endowment, in general the coverage of the Russian economy is divided into two camps, namely those who report that Moscow is on the verge of collapse, and those who say that these sanctions are making Russia stronger. So which one is correct? Below is a collection of facts to understand the current state of the Russian economy.

4 Facts about the Russian Economy While Being Affected by Western Sanctions

1. Many Western Companies Are Leaving Russia

Since Russia was hit by sanctions from the West, many companies have started to leave Moscow, including McDonald’s, Coca-Cola, Starbucks and Heineken.

Even so, not all Western companies have stepped away, there are still some companies that still survive, such as the American cosmetics company, Avon, and PepsiCo.

2. Oil keeps the Russian economy afloat

Reporting from Euro News, despite being subject to many sanctions, Russia remains one of the world’s largest oil exporters, and has benefited from Saudi Arabia’s decision last year to reduce crude oil exports.