Professor at Sciences Po, former chief economist of the European Bank for Reconstruction and Development (EBRD), Sergei Guriev was one of Vladimir Putin’s economic advisers in the early 2010s, before going into exile in France, worried about his safety, after criticizing the arrests of opponents of the Russian president’s re-election in 2012. He explains why the latter underestimated Western sanctions. And how, deprived of the money from hydrocarbons, he would struggle to continue the war and finance repression in his country.
The extent of the reaction of Westerners, in particular with the freezing of the assets of the Russian Central Bank, surprised Vladimir Putin. Why ?
Observing the political polarization in the United States, the withdrawal of American troops from Afghanistan [achevé fin août 2021] and the lack of unity in Europe, he was convinced that the West was weak and divided. He thought that the invasion of Ukraine would be completed in a few days, like that of Crimea [en 2014], and that Western sanctions would come late, if at all. He also underestimated the Ukrainian resistance and overestimated the strength of the Russian army.
This is not a bug, but a feature of the system that Vladimir Putin has built. He suppressed all dissenting voices around him, as in society. He is surrounded by people who are afraid to stand up to him. He only receives biased messages from them, praising the policies he pursues and underestimating his opponents. He is misinformed. This explains why he takes these seemingly irrational risks.
Faced with sanctions, can the Russian economy sustain itself for a long time?
Yes, although it will be considerably weakened. In particular, it can hope to substitute certain Western technologies with those designed in China. In this respect, two questions will be decisive. The first is that of hydrocarbons. If an embargo were imposed and Russia no longer received gas and oil money, it would face a major fiscal problem. Mr. Putin would then find it difficult to pay his soldiers, the police who beat up protesters and the propagandists, whom he needs more than ever.
The second is that of China. Will it agree to support Moscow unreservedly, or will it fear being sanctioned in turn by the West, knowing that its prosperity depends on Europe, one of its main trading partners? China may not be as faithful as Mr. Putin hopes.
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