Table of Contents
Russia mainly depends on its economic status to finance the war in Ukraine, a move that has left several properties destructed lives lost and people displaced for safety. The invasion of Russia in Ukraine has led to a great economic impact on Ukraine and the entire world. The impact is being felt on the high rises in various essential commodities such as oil and other energy products. However, the continued stable status of Russia has facilitated the continued war in Ukraine. Various countries have applied sanctions on the Russian economy to destabilize the economy to end the war. The Russian economy is, therefore, facing various challenges due to the sanctions impacted on it. By experiencing shutdowns of various companies and industries which mainly depended on imports, the country’s gross domestic product was reduced, which caused an insufficiency of essential commodities. The state of insufficiency creates an environment that reduces the impacts of Russia in Ukraine due to the lack of extra resources. According to reliable information, the country has lost half of its imports, leading to insufficiencies. Closing the imports was essential in containing wars in Russia since the companies and industries that depended on importation could not conduct their activities and were facing a shutdown.
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Shrinking Budget Revenue
Sanctions have increased government spending to cater to the deficiencies caused, which have shrunk budget revenues. The shrinking of the budget revenue was essential since it forced the Russian government to concentrate on essential services such as providing necessary goods and services to its people rather than greatly impacting the current wars (Beauregard, 2022). The Russian government currently has to balance the two roles of keeping the economy active and handling Ukraine’s wars. The uncertainties caused by the sanctions have, therefore, been effective in controlling the impacts of Russia in Ukraine. Russia imports machinery, equipment, and transport, representing 45% of the total imports (Beauregard, 2022). The machinery is essential since Russia uses them to manufacture various war facilities such as weapons, vehicles, warships, and aircraft, among other commodities. Therefore, applying sanctions on such importation denies Russia an opportunity to restock its defense department, which makes it weaker to maintain the war standards in Russia (Beauregard, 2022). The sanctions are effective since they help control the Ukraine war’s scaling potential. Lack of machinery put Russia in a critical condition, making them call off the war and support peace talks between them and Ukraine. Currently, machinery and equipment are deficient for transport that can help the country escalate the wars in Ukraine.
Restriction on Importations of Chemical, Foodstuff, and Agricultural Products
Similarly, Russia imports chemical products at around 19% of the total used in various manufacturing and production activities. Some of the chemical products are essential in manufacturing the weapons being used in Ukraine (Grzegorczyk, Poitiers, Weil & Wolff, 2022). Besides, some of the chemicals are used in manufacturing artificial fertilizers for agricultural purposes, while others are used in manufacturing several health-related components. Therefore, imposing sanctions on Russia denies it an opportunity to support its manufacturing and processing activities of essential commodities such as weapons. Besides, the agricultural sector is also impacted, which greatly threatens the country’s economic status and future sustainability. Also, the lack of chemicals impacts the health sector since the chemicals are used to manufacture different medicines and medical-related objects. The lack of chemical products through sanctions is, therefore, aimed at destabilizing the economy of Russia from several perspectives (Huang & Lu, 2022). The destabilization of the Russian economy is likely to push for peace negotiations between Russia and Ukraine so that Russia can access its imports for economic programs.
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Russia also imports foodstuffs and agricultural products at around 14.5% of the total imports. The high percentage of foodstuff and agricultural products indicates the country’s high dependency on other countries for its effective operations (Oxford, 2022). The percentage illustrates that Russia needs to reinstall the good cooperation and coordination among the countries to have its imports reinstated. The sanctions on foodstuff and agricultural product imports have led to a high level of food shortages within the country, which forces the government to concentrate on offering essential services to the public instead of escalating the war (Huang & Lu, 2022). Besides, the lack of certain essential agricultural products such as fertilizers puts the country in a critical condition which might result in a great economic threat in the future. Russia is likely to be forced to admit peace negotiations to ensure that sanctions are lifted before they cause total damage to the country’s economy (Huang & Lu, 2022).
In summary, sanctions are required in the current war to control the war power of the Russian government. Russia had good planning and preparations for the war, which might see it impose further complications between the two countries. The increased war activities in Ukraine have led to huge destruction, which will take the country to restore. Therefore, to control the impacts of the Russian forces, it was necessary to impose various sanctions. Besides, the sanctions will change the course of the war differently. For instance, imposing import sanctions bars Russia from acquiring essential resources to promote their products and support reinforcing weapons and personnel in Ukraine. Also, the imposition of sanctions bars importation which enhances government expenditure on liabilities, destabilizing the country’s economy and making it weak to support the war.
- Beauregard, P. (2022). International emotional resonance: Explaining transatlantic economic sanctions against Russia. Cooperation and Conflict, 57(1), 25-42.
- Grzegorczyk, M., Poitiers, N., Weil, P., & Wolff, G. B. (2022). The risks for Russia and Europe: how new sanctions could hit economic ties. Bruegel-Blogs, NA-NA.
- Huang, L., & Lu, F. (2022). The cost of russian sanctions on the global equity markets. Available at SSRN 4060927.
- Oxford Analytica. (2022). Czech and Polish anti-inflation plans may work better. Emerald Expert Briefings, (oxan-db).