Dmitry Belousov, who leads analysis and forecasting of macroeconomic processes at the Center for Macroeconomic Analysis and Short-Term Forecasting, argues that Russia’s sanctions measures cannot be labeled effective given the current economic dynamics. His assessment comes as part of a broader attempt to separate the rhetoric of sanctions from the practical outcomes observed in markets and production lines across the country and beyond, where the needle of impact often points in nuanced directions rather than a straight line toward collapse.
Belousov notes that the initial compliance with sanctions manifested in Russia in a way that reflected both policy intentions and market realities. He argues that the principal mistake of those advocating harsher restrictions is to assume a world that remains endlessly cyclical in terms of production and supply chains. Sanctions targeting the export of raw materials and essential components do not translate into immediate or comprehensive disruption. In his view, the historical context from the 1990s suggests that, while there were few analogues then, today most processes can adapt or be replaced. In this sense, sanctions may not achieve the sweeping effectiveness that some proponents anticipate, and their overall efficiency in altering long-term trajectories remains questionable.
According to Belousov, Russia maintains a considerable margin for inflation containment. He explains that as the year ends, inflationary pressures are expected to hover around a modest level, offering some room for policy maneuvering. He also highlights a demand deficiency within the domestic economy. Consumers and businesses have shifted their purchasing patterns, with many non-food products exiting the market last year and households delaying purchases to future dates. The combination of weak demand and the entry of lesser-known firms into certain market segments has contributed to a subdued pace of growth across sectors, creating a more gradual overall inflation path rather than a rapid ascent.
Belousov also points to a relatively modest level of imports of automotive components. The question then becomes which sectors and players will gain from any faster revival of demand. He underscores the pace at which Russia can recover lost ground in imports of components and investment equipment, cautioning that while the experiences of other large economies illustrate that losses can be compensated, the speed of such compensation is not guaranteed. The analysis suggests there are structural frictions and time lags that influence how quickly the economy can reorient its supply chains and investment cycles, which in turn shapes the trajectory of growth and inflation in the near term.
Earlier in the year, a meeting between the Russian president and the Minister of Economic Development discussed the current state of the economy and the outlook for various policy measures. The minister provided an update on indicators, policy actions, and the evolving balance between external constraints and internal resilience. The dialogue reflected ongoing efforts to monitor economic performance, adjust fiscal and monetary stances, and assess the effectiveness of sanctions within a broader strategy for stabilizing and guiding the economy through a period of adjustment and reform.