15 March 2018

Bloomberg: Putin Is Sure of Victory, But Little Else

Cruising to a fourth term in the March 18 elections, Vladimir Putin is relying on a deep well of support based on two main factors: the huge rise in living standards over his 18 years in office and Russia’s triumphant return to the world stage. When he came to power, he warned that “for the first time in the last 200–300 years, Russia is facing the real danger of winding up among the second or even third-tier of nations in the world.” [...]

Years of underinvestment and a business environment marred by predatory government officials and ever-expanding state companies stymied efforts to expand beyond Russia’s reliance on oil and other natural resources. Sanctions, which squeezed access to Western capital and technology, only made that worse, cutting as much as a full percentage point off growth by some estimates. Adding to the pain of cheaper oil, the ruble nosedived, eroding the affordability of imported goods or trips abroad. The travel industry was among those hurt. [...]

Putin’s initial economic ambitions now seem modest: to match the per-capita income of Portugal within 15 years. But even that has proved out of reach. Slow growth and a weak ruble mean Russia’s now falling further behind. U.S. sanctions will remain “at least as long as Putin is in power,” predicts Andrei Kortunov, head of the Russian International Affairs Council, a research group set up by the Kremlin. [...]

In addition to the depleted resources to fund his assertive foreign policy, Putin now faces a Western world on guard for his next moves. Kremlin efforts to influence votes for pro-Russia candidates in France and Germany fell flat last year, for example, after both countries said they’d prepared for such efforts to manipulate news and the Internet. Other countries, such as Austria and the Czech Republic, count in his “win” column.

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