Only the war in Ukraine keeps the Russian economy afloat - Media.

Intervention in Ukraine is the only thing preventing Russia from slipping into recession. This opinion was expressed by economists interviewed by Business Insider magazine.

According to Jay Zagorsky, an economist and professor at the Questrom School of Business at Boston University, Russia's huge military budget supports its declining economy. But this is only a temporary solution to Russia's growing economic problems, such as inflation, currency, and budget issues.

«The Russian economy is now supported by large government expenditures, so in no sector of the economy where the Russian government purchases goods will there be a decline,» Zagorsky said, noting the Kremlin's purchase of military clothing, footwear, ammunition, and food as part of the military actions against Ukraine. «Therefore, if there were no war, there would be a recession».

According to Yuri Gorodnichenko, an economist and professor at the University of California, Berkeley, as long as the war continues, the Time for decline in the Russian economy remains uncertain. Next year, the Russian Federation will allocate a record 13.2 trillion rubles to the defense budget, which will help stimulate its economy. But such significant expenditures cannot last indefinitely, Gorodnichenko notes.

«Thanks to state money, they can support the economy, but there will come a time when the government runs out of money, and the recession will begin,» he adds.

Zagorsky believes that inflation is one of the biggest problems. According to Russia's official statistical service, in August, consumer prices rose by 9% compared to the previous year.

But Zagorsky argues that inflation could be even higher, citing the practice of the Soviet Union, which understated inflation rates during the Cold War.

Gorodnichenko asserts that the Russian economy also suffers from currency problems due to Russia's limited access to the dollar because of Western sanctions. This limits Moscow's trading possibilities, especially oil products, which account for a significant portion of its revenues.

Russia has turned to alternative currencies, such as the Chinese yuan, but Chinese companies are increasingly hesitant to do business with Russia, fearing dual sanctions from the US and other Western countries.

Source: UNIAN