The Russian oligarchs force Vladimir Putin's hand, after they complained that the country's economy is in the ropes
Vladimir Putin. Photo source: Alexander Demianchuk / Zuma Press / Profimedia
Russia's president Vladimir Putin announced that his country will start to reduce the huge expenses for the army, after several influential businessmen have complained that the economy no longer cope, writes the Russian independent publication The Moscow Times.
According to the quoted source, even the most powerful people in Russia begin to say that the war has become too expensive, not only for the state budget, but also for the real economy. And Putin, although he does not give up military plans, seems to begin to give in to the pressures inside.
The Russian leader said that the defense budget reached 13.5 trillion rubles, ie 6.3% of GDP – a record amount, as it was from the USSR period. The president acknowledged that he is “much” and said that in the next three years he will try to reduce these expenses.
There is still no final understanding between the Ministry of Defense, Finance and Economy, but “everyone goes in this direction,” said the Kremlin leader.
Putin admitted that the explosion of military spending has led to inflation, but claims that the government is trying to keep it under control.
He also recognized that Russia's economy no longer grows as before: in the past years it boasts over 4% annual growth, but now the pace has intentionally reduced, to fight inflation, the Russian president also put.
Russia, “a step -by -step” recession
Putin also said that Russia wants to finish the war in Ukraine, but “with a favorable result to the country”, and the money on the army is not for attacks on Europe. However, he took the opportunity to criticize NATO, who wants to increase his military expenses to 5% of GDP by 2035.
His statements come after, at a recent economic forum at St. Petersburg, several Russian officials and heads of big companies have fired alarm, writes The Moscow Times.
The Minister of Economy, Maxim Resetnikov, said that Russia is “on a step” of recession, while the head of the central bank, Elvira Nabiullina, warned that the economy has exhausted all the resources-they are no longer free workers, the factories go to full capacity, and from the state reserves have already spent two thirds.
Also, the head of the Industrial Union, Aleksandr Şhin, said many companies in Russia are almost bankrupt, while billionaire Alexei Mordashov, the severstal owner, said that companies are risked in collapse due to huge interest and increasing demand.
Arkadi Rotenberg, a close relative of Putin and one of the richest people in Russia, acknowledged that “it's not a light period” and that business hardly survives, having to take expensive loans to start new projects.
