Ukraine war brings the Russian Caucasus to its knees
Sanctions and military mobilisation are weighing heavily. In the 'Ciscaucasia', companies have lost up to 90% of their turnover. Income consumed by inflation. Income from the sale of energy resources will suffice for a year. It is difficult for the central government to make financial concessions to the periphery.
Moscow (AsiaNews) - The entire Russian economy is increasingly suffering the consequences of the war in Ukraine, but those suffering most among the Federation's regions are those of the Northern Caucasus.
The almost total blockade of imports, the slowdown in work activities in every field, the sharp decrease in citizens' spending and local production, the mass emigration of middle-class representatives and the death of thousands of men of working age at the front - these are just some of the factors that are bringing the entire Russian and Caucasian way of life to its knees.
While in Russia as a whole the economic collapse has not yet fully affected the average standard of living of citizens, in the Caucasian republics of Chechnya, Ingushetia, Dagestan, Kalmykia, North Ossetia, Kabardino-Balkaria and Southern Russia, the area known as 'Chechnya', the consequences are already being felt more acutely.
Between January and August in Dagestan alone, companies lost almost 90% of their turnover. In the Stavropol region, wholesale trade fell by more than 91% (retail trade by 30%); in Ossetia it dropped by 72%.
Throughout the region, product prices have risen frighteningly (between 15 and 40 per cent) and galloping inflation has consumed the population's incomes, as confirmed by statistical data from the Rosstat institute.
The Caucasian republics are highly dependent on economic transfers from the centre of Russia, as Professor Natalia Zubarevič, an economics specialist at Moscow's Mgu University, reminds us: "Government funding has increased in all regions, in different ways, without being able to fill the holes created by the war context, and the mobilisation of recent weeks will have increasingly catastrophic consequences for the incomes of local administrations, and families in general".
Another worrying fact is the growth of the public debt, which on average in the Russian federal subjects is around 5%, while in Chechnya it exceeds 20%. The central state will be less and less able to assist the regions, especially with the gradual western embargo on gas and oil, which is also a 'self-embargo', as political scientist Sergej Žavoronkov of the 'Liberal Mission' foundation observes, according to which 'the means to maintain a sufficient level of collective welfare will suffice for one year at most'.
As many experts point out, the energy sanctions are not being felt much for the time being due to the high prices of resources, but this factor is set to change quickly in the coming months, and from December Russia will only be able to sell to partners in Asia and the poorer countries, at much lower prices than at present, and even lower than before.
The economic effects of the mobilisation are difficult to quantify at the moment, but statistics will soon begin to calculate them. Perhaps only income from agricultural work will grow, thanks to high food prices and increased demand due to falling imports.
Moscow will be forced to maintain funding to the Caucasian regions, having to buy their loyalty and avoid the increasingly widespread separatist sentiments, and it will not be easy if war developments become even more dramatic, with the possible use of atomic weapons and the international condemnation of Russia as a terrorist country, due to the massacres and destruction of power plants, to leave the Ukrainians freezing cold.
Chechen President Kadyrov, who most of all supports and fuels the war in Ukraine, is therefore blackmailing the Moscow centre in an increasingly brazen manner, showing all the regional governors the way to defend their own economy at the expense of the federal one, thus creating the conditions for an even more systematic collapse.
Any increase in taxes, the only way to feed the budget, would provoke a negative reaction even in the strata of the population that most support state policy, and Russia could implode economically, ending up waging war on itself rather than on external enemies.
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22/09/2022 08:55
13/12/2021 09:06
