My Twitter feed frequently shows me stories about how the Russo-Ukrainian War has devastated the Russian economy and how Vladimir Vladimirovich Putin has led the country down the toilet. But, alas!, it seems that maybe, just maybe, things haven’t gone quite as we’ve been told. From The New York Times:
Russia Sidesteps Western Punishments, With Help From Friends
A surge in trade by Russia’s neighbors and allies hints at one reason its economy remains so resilient after sweeping sanctions.
by Ana Swanson | Tuesday, January 31, 2023 | 5:00 AM EST
WASHINGTON — A strange thing happened with smartphones in Armenia last summer.
Shipments from other parts of the world into the tiny former Soviet republic began to balloon to more than 10 times the value of phone imports in previous months. At the same time, Armenia recorded an explosion in its exports of smartphones to a beleaguered ally: Russia.
The trend, which was repeated for washing machines, computer chips and other products in a handful of other Asian countries last year, provides evidence of some of the new lifelines that are keeping the Russian economy afloat. Recent data show surges in trade for some of Russia’s neighbors and allies, suggesting that countries like Turkey, China, Belarus, Kazakhstan and Kyrgyzstan are stepping in to provide Russia with many of the products that Western countries have tried to cut off as punishment for Moscow’s invasion of Ukraine.
Those sanctions — which include restrictions on Russia’s largest banks along with limits on the sale of technology that its military could use — are blocking access to a variety of products. Reports regularly filter out of Russia about consumers frustrated by high-priced or shoddy goods, ranging from milk and household appliances to computer software and medication, said Maria Snegovaya, a senior fellow for Russia and Eurasia at the Center for Strategic and International Studies, in an event at the think tank this month.
Even so, Russian trade appears to have largely bounced back to where it was before the invasion of Ukraine last February. Analysts estimate that Russia’s imports may have already recovered to prewar levels, or will soon do so, depending on their models.
There’s a lot more at the original, but, put basically, Russia has found new routes of trade, including through Turkey, a NATO member nation, to make up for those cut off by Western economic sanctions. It should have been obvious: with China as an ally, Russia was never going to be hit as hard as Western economic projections had guesstimated, and it’s pretty difficult to restrict technology as long as China is there.
FESCO, the Russian Far East Shipping Company, added a new FESCO Turkey Black Sea Service on the Novorossiysk – Istanbul – Gebze – Novorossiysk route in April of 2022, as the Western sanctions were starting to take hold. Many consumer goods imports by Russia fell following the post-invasion sanctions, but Western brands which were restricted have been replaced by Chinese goods.
We shouldn’t kid ourselves: just because the Western nations have decided that Russia’s invasion of Ukraine is horrible does not mean that nations outside of Western culture have just gone along with that. China, for one, has a vested interest in seeing the West waste money and military equipment sending aid to Ukraine, to see it get expended on the Ukrainian battlefields, and if Xi Jinping isn’t all that interested in seeing Russia grow stronger, seeing the West get weaker certainly brings a smile to his face.
China’s only real worry? That Russia will up the ante by using a couple of ‘tactical’ nuclear weapons against Ukrainian positions and supply and transfer depots for Western military hardware. Crossing the nuclear threshold would have Western leaders defecating in their pants, which both Russia and China know and would love to see, but there’s no guarantee that a limited use of nuclear weapons would stay limited.
The war has gone on for eleven months now, and if there will be no real winner between Russia and Ukraine — Russia will continue to see serious sanctions and have a huge loss of military prestige, while Ukraine, even if it somehow ‘wins,’ has been devastated — China has already won. And the longer the war continues, the bigger China’s win will become.