Invading Crimea May Have Cost Russia $200 Billion So Far

Get your news from a source that’s not owned and controlled by oligarchs. Sign up for the free Mother Jones Daily.


Russia’s military actions are costing it dearly:

Russia’s annexation of Ukraine’s Crimea region last month and the instability it created in Russian financial markets were cited by government officials for record capital flight and sharply downgraded growth forecasts for the country. Finance Minister Anton Siluanov said that instead of projected 2.5% growth this year, Russia’s economy might show no growth at all.

….U.S. and European sanctions to punish Russia for occupying and annexing Crimea have so far targeted only a few dozen officials and businessmen. But the prospect of broader penalties, such as a Western boycott of Russian oil and gas, have scared investors into cashing out their ruble-denominated assets for hard currency and taking their money abroad. Russia’s foreign exchange reserves were drained of a record $63 billion in the first quarter of the year, Economic Development Minister Alexei Ulyukayev said Wednesday in an address to the lower house of the parliament.

….Russian stocks fell 10% last month, wiping out further billions in capital. The ruble has lost 9% of its value since the start of the year, boosting prices for the imported food and manufactured goods on which the Russian consumer market is heavily dependent. “The acute international situation of the past two months” was the cause, Ulyukayev said, referring to the Ukraine unrest.

That’s a helluva big drop in economic growth. Just by itself, it represents a cost of $50 billion. Add in the flight of cash and the stock market decline, and you’re somewhere in the neighborhood of $200 billion.

Is that enough to make Russia blink? Maybe not. But it hurts, and the prospect of losing even more has got to be enough to give even Vladimir Putin a few second thoughts.

PLEASE—BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things it doesn’t like—which is most things that are true.

We’ll say it loud and clear: At Mother Jones, no one gets to tell us what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. The deadline’s almost here. Please help us reach our $150k membership goal by May 31.

payment methods

PLEASE—BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things it doesn’t like—which is most things that are true.

We’ll say it loud and clear: At Mother Jones, no one gets to tell us what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. The deadline’s almost here. Please help us reach our $150k membership goal by May 31.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate