Three months after the February 24 offensive, many ordinary Russians are finding their livelihoods and emotions affected by those blows. Moscow’s sprawling shopping malls have turned into terrifying expanses of closed storefronts once occupied by Western retailers.
McDonald’s — whose inauguration in Russia in 1990 was a cultural phenomenon, a dazzlingly modern facility coming to a deserted country because of limited options — pulled out of Russia entirely in response to its invasion of Ukraine. IKEA, the epitome of affordable modern comforts, suspended operation. Thousands of jobs that were once safe are now suddenly in question in a very short period of time.
Major industrial players including oil giants BP and Shell and automaker Renault walked away despite their huge investments in Russia. Shell has estimated that its attempt to unload its Russian assets will cost it about $5 billion.
When multinationals were leaving, thousands of Russians who had the economic means to do so were also fleeing, fearful of the harsh new government’s moves involving war, which they saw as a plunge into total authoritarianism. Some young men may have even fled for fear that the Kremlin would impose a mandatory draft to feed its war machine.
But escaping had become much harder than before – 27 EU countries, along with the United States and Canada, had banned flights to and from Russia. The Estonian capital of Tallinn, once an easy 90-minute long weekend destination by air from Moscow, suddenly took at least 12 hours to reach on a route through Istanbul.
Even the bizarre journey through the Internet and social media has come to a halt for Russians. In March Russia banned Facebook and Instagram – although this can be circumvented using a VPN – and foreign media including the BBC, US government-funded Voice of America and Radio Free Europe/Radio Liberty and German broadcaster Deutsche Welle. Blocked access to websites. ,
Several important independent news media closed or suspended operations after Russian authorities passed a law calling for up to 15 years in prison for stories containing “fake news” about the war. These included Eko Moskvi radio station and Novaya Gazeta, the newspaper whose editor, Dmitry Muratov, shared the most recent Nobel Peace Prize.
The psychological cost of repression, sanctions and shrinking opportunities on ordinary Russians may be high, though difficult to measure. Although some opinion polls in Russia have suggested support for Ukraine war Strong, the results are potentially skewed by respondents who remain silent, wary of expressing their real views.
Andrei Kolesnikov of the Carnegie Moscow Center wrote in a commentary that Russian society is currently in the grip of “aggressive subjugation” and the erosion of social relations may accelerate.
“Discussions get wider and wider. You can call your compatriot – a fellow citizen, but someone who has a different opinion – a “traitor” and consider them a lowly person. You can call the most senior state officials As such, one can freely and fairly calmly speculate on the possibilities of nuclear war. was completely unimaginable,” he wrote.
“Now this understanding is diminishing, and it is another sign of the anthropological disaster that Russia is facing,” he said.
The economic results are not yet fully revealed.
In the early days of the war, the Russian ruble lost half its value. But government efforts to shore it up have actually pushed its value higher than it was before the invasion.
But in terms of economic activity, “it’s a completely different story,” said Chris Weifer, a veteran Russia economy analyst at Macro-Advisory.
“We now see a slowdown in the economy across a wide range of sectors. Companies are warning that their stock of spare parts is running out. Many companies employ their employees part-time and others are warning them that they will have to lay off completely. So there is a real fear that unemployment will rise in the summer months, that there will be a big drop in consumption and retail sales and investment,” he told the Associated Press.
The comparatively strong ruble, though it may sound pleasant, also poses problems for the national budget, Weifer said.
“They effectively get their revenue in their foreign currency from exporters and they are paid in rubles. So the stronger the ruble, it means the less money they actually have to spend,” he said. “(That) also makes Russian exporters less competitive, as they are more expensive globally.”
If the war continues, more companies may exit Russia. Weifer suggested that companies that only suspended operations could resume them once a ceasefire and peace deal for Ukraine was reached, but said the window for this may be closed.
“If you walk around the shopping malls in Moscow, you can see that many fashion stores, Western business groups have just pulled the shutters down. Their shelves are still full, the lights are still on. They just are not open. So they haven’t pulled out yet. They are waiting to see what happens next,” he explained.
Wafer said those companies will soon be pressured to resolve the limbo that they have in their Russian business.
“We are now getting to the stage where companies are starting to run out of time, or maybe run out of patience,” he said.