Swedish Report: Putin’s Economic Facade Is Cracking

The war between Russia and Ukraine has not had positive effects on the Russian economy. According to Sweden’s intelligence service, MUST, Russia portrays its economy as far more stable than it actually is, Euronews reports.

According to the new Swedish report, the Russian economy is in crisis, facing rising inflation, growing debt, and a large budget deficit.

Nevertheless, MUST believes that Russia is not changing course despite its weakening economy. On the contrary, the agency believes the Kremlin still aims to continue the invasion of Ukraine and its hybrid activities against EU and NATO countries.

War Economy Under Pressure

MUST also points out that Russia will need to further increase oil prices in order to avoid a major budget deficit, Euronews reports.

Thomas Nilsson, head of MUST, has also stated that the Russian central bank’s official figures are not reliable indicators of how inflation has actually developed. According to him, inflation is closer to 15% rather than the central bank’s estimate of 5.86%.

Nilsson also warns that Russia is financing itself through debt and that there are signs of serious problems in the Russian banking sector.

“The Russian economy can only go in one of two directions: long-term recession or shock,” Nilsson said. “In either case, it will continue on a downward trajectory toward financial disaster.”

Putin Denies

We have also previously reported on how the Russian economy has experienced economic hardship, particularly within the banking sector.

Smaller banks in Russia in particular are facing significant economic pressure, and one in five banks is expected to operate at a loss.

Nevertheless, Vladimir Putin rejects the idea that there is any cause for concern. Instead, he argues that the downturn is due to seasonal fluctuations, Euronews reports.

Sources: Euronews, MUST

This article is made and published by Christine Drews Sieger, who may have used AI in the preparation