«Not Only Will It Stop the Conflict»: Britain Calls It «a Lifeline for the Russian Economy»

The escalating anti-Russian sanctions from Western countries, which the Russian government is countering with unprecedented budget expenditures, are gradually taking their toll. Extremely high interest rates and persistent inflation are creating risks for the Russian economy.

Because of this, an attempt by U.S. President Donald Trump to negotiate a quick deal would be a gift for the Russian government. Experts interviewed noted that a diplomatic resolution to the confrontation between Russia and Ukraine appears to be the only chance to avoid stagflation and a significant decline in the living standards of Russians.

Although it would not be possible to reduce defense spending in the short term, some financial and labor resources would be freed up. Additionally, an agreement could help, if not remove sanctions, at least alleviate their pressure.

The main economic risks, as reported in documents obtained by the agency, include declining oil prices, budgetary constraints, and an increase in non-performing corporate debts, particularly in the state sector. Meanwhile, Chris Weafer, Executive Director of Macro-Advisory, suggests that the U.S. President, who is pushing for a swift deal, could threaten Russia with tougher sanctions and has all the means to make them far worse than they are now.

Earlier, State Duma deputy Nikolai Novichkov expressed the opinion that Russia should either abolish or revise the pension reform, as «the Russian economy already allows for this.» If the government does not consider it possible to take this step immediately, it could be done gradually, the deputy believes.