Three months after the February 24 invasion, many ordinary Russians are struggling with their livelihoods and emotions. Large shopping malls in Moscow have turned into catastrophic expanses of closed shop windows that were once occupied by Western retailers.
McDonald’s – but the opening in Russia in 1990 was a cultural phenomenon, the shining modern conveniences that came to a miserable country bound by limited choice – withdrew from Russia entirely in response to its invasion of Ukraine. IKEA, the image of modern convenience at an affordable price, suspended operations. Tens of thousands of jobs that were once secured are now suddenly being created in a very short time.
Major industrialists, including oil giants BP and Shell, and carmaker Renault went bankrupt, despite their large investments in Russia. Shell has estimated that it will lose about $ 5 billion in trying to dispose of its Russian assets.
While the multinational corporations were on the move, thousands of economically capable Russians, even on the run, were afraid of drastic new war-related measures that they saw as totalitarianism. Some young men may also have fled for fear that the Kremlin would make a compulsory flight to feed its war machine.
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But escape had become much more difficult than it once was – the 27 countries of the European Union, along with the United States and Canada, had banned flights to and from Russia. The Estonian capital Tallinn, once an easy destination for a long weekend of 90 minutes by plane from Moscow, suddenly took at least 12 hours to reach via Istanbul.
Even surrogate internet travel and social media have diminished for Russia. Russia banned Facebook and Instagram in March – although it can be circumvented by using a VPN – and blocked access to foreign media websites, including the BBC, the US government sponsoring Voice of America and Radio Free Europe / Radio Liberty and the German radio station Deutsche Well. .
After the Russian authorities passed a law requiring up to 15 years in prison for news containing “fake news” about the war, many important independent news outlets shut down or shut down. These included Ekho Moskvy Radio and Novaya Gazeta, the newspaper in which editor Dmitry Muratov shared the latest Nobel Peace Prize.
The psychological costs of oppression, restrictions, and diminishing opportunities could be high for ordinary Russians, though difficult to measure. Although some opinion polls in Russia suggest strong support for the Ukraine war, the results are likely to be skewed by respondents who remain silent and refrain from expressing their views.
Andrei Kolesnikov of the Carnegie Moscow Center wrote in a statement that Russian society is now embroiled in “aggressive surrender” and that social disintegration could accelerate.
“The debate is getting wider and wider. You can call your countrymen – fellow citizens, but someone who has a different opinion – a “traitor” and consider him an inferior person. You, like senior government officials, can freely and calmly reflect on the prospects for a nuclear war. “It is” something that was certainly never allowed during the Soviet era at Pax Atomica, when both parties understood that the damage that followed was completely unthinkable, “he wrote.
“Now that understanding is diminishing and it is another sign of the anthropological disaster that Russia is facing,” he said.
The economic consequences are yet to be fully realized. In the early days of the war, the Russian ruble lost half its value. But the government’s efforts to strengthen it have in fact raised its value to higher than it was before the invasion.
But in terms of economic activity, “it’s a whole other story,” said Chris Weafer, a seasoned Russian economist at Macro-Advisory.
“We are seeing a deterioration in the economy now in a wide range of areas. Companies warn that their spare parts inventory is running out. Many companies put their employees on a part-time basis and others warn them that they will have to lay off completely. “So there is a real fear that unemployment will increase over the summer months, that there will be a sharp decline in consumption and retail and investment,” he told the Associated Press.
The relatively strong ruble, however stimulating it may seem, also poses problems for the state budget, Weafer said.
“They actually get their income in foreign currency from exporters and their payments are in rubles. So the stronger the ruble, the less money it actually has to spend, “he said.” (It) also makes Russian exporters less competitive, because they are more expensive globally.
If the war drags on, more companies could leave Russia. Weafer suggested that those companies that have only stopped operations could resume them if a ceasefire and a peace agreement for Ukraine are reached, but he said that the window for this could be closed.
“If you walk through shopping malls in Moscow, you can see that many boutiques, Western business districts, have simply closed their doors. Their shelves are still full, the lights are still on. They are simply not open. So they have not withdrawn yet. “They are waiting to see what happens next,” he explained.
These companies will soon be pressured to resolve the limbo in which their Russian companies are, Weafer said.
“We are now getting to the point where companies are running out of time, or maybe impatient,” he said.
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