9 Ways Putin Has Let Russia Down
Grandstanding in Crimea runs counter to Russia’s economic interests — and may cost Putin his power.
March 16, 2014
1. The ultimate loser in a standoff between Russia and the West will very likely be Putin.
2. Russia’s president can probably get some short-term popularity boost now by annexing Crimea.
3. However, Russia is a fragile petro-state that cannot afford the costs of sanctions, let alone the costs of war.
4. That is why the incursion into Crimea probably marks the beginning of the end of Putin.
5. By raising the specter that Western businesses in Russia may be expropriated in tit-for-tat sanctions, Russia has probably already imposed a big sanction onto itself.
6. Scaring off the foreign investors, which Russia needs to modernize its flagging economy, is the last thing Russia should want to do.
7. Mounting economic problems and pervasive capital flight present serious economic problems for Russia.
8. Putin is probably facing some rather strong objections from Russian oligarchs against policies that could disrupt their businesses badly.
9. Putin’s hold on Russia could become rather tenuous one or two years from now.
From “Russian Scenarios” by Holger Schmieding, Berenberg Bank.