Putin on the brink as Russia’s economy could be about to implode for three key reasons

Tyler Mitchell By Tyler Mitchell Jun14,2024

In recent weeks, Russia has made troubling advances across Ukraine and the Kremlin has landed strikes on Kyiv and Kharkiv.

Meanwhile, President Zelensky has urged western leaders to give his military the tools it needs to force Putin into peace talks, as Reuters reports that the Moscow may be open to a ceasefire if the borders can be redrawn at the current front lines.

Despite the dire situation in Ukraine, Kyiv can cling to the hope that Russia becomes unable to continue to fund its brutal war.

And there are several reasons to believe that this hope becomes a reality in short order.

Express.co.uk breaks down the three economic challenges facing the Kremlin, which bring Putin’s war machine grinding to a halt.

Spiralling Inflation

A leading academic has claimed that Russia is grossly misreporting its inflation rate, with prices rising far faster than the Kremlin is letting on. According to John Hopkins economist Professor Steve Hanke, the Russian rate of inflation is close to 27 percent, rather than the 7.2 percent claimed by Moscow.

If inflation is not brought under control, or worse continues to rise, the Russian economy could soon be on its knees.

Labour Force Chaos

According to British Defence Intelligence, Russia is “currently experiencing a labour shortage that is becoming a significant problem in some sectors”.

Independent broadsheet Izvestia Russia estimated that in 2023 the Russian economy was short 4.8 million workers.

The war in Ukraine has required vast human resources, which is partially to blame for the shortfall in labour. However, the Kyiv Post is also reporting that Russia has begun deporting Central Asian workers, which often perform manual roles essential to the functioning of the economy.

Moscow can’t rely on Beijing

Although Putin and President Xi are key allies, China has not reacted favourably to some of Russia‘s tactics in prosecuting its war in Ukraine.

For example, it is thought that Beijing is unhappy with the Kremlin’s nuclear threats. Zhao Tong, from the Carnegie Institute, cited in a BBC report, said that Xi is wary of the “reputational costs of appearing to offer unconditional support to Russia“.

Moreover, Russian markets are far less lucrative to China than economic ties with the West. The Kyiv Post reports that China exports £1trillion to the US, EU, Japan, South Korea vs £87billion exported to Russia.

Tyler Mitchell

By Tyler Mitchell

Tyler is a renowned journalist with years of experience covering a wide range of topics including politics, entertainment, and technology. His insightful analysis and compelling storytelling have made him a trusted source for breaking news and expert commentary.

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