Secret funding of the war by the Russian Federation is at risk: expenses exceed expectations by twice.

Russia spends more money on the war with Ukraine than on its own defense

According to former financier Craig Kennedy, Russia spends significantly more money on the war with Ukraine than on securing its own defense. This policy could lead to a financial crisis for the Kremlin, as it is impossible to meet the army's needs. According to Kennedy, Russia uses a shadow financing scheme for the war by providing defense enterprises with preferential loans. In 2022, the volume of corporate borrowing in Russia surged by 71%, even exceeding revenues from oil and gas and defense spending. Most of these loans have been issued to companies linked to the war and unable to repay them. The provision of these loans has led to uncontrolled inflation, forcing the Russian central bank to raise its key rate. In Kennedy's opinion, the Russian government will soon face the need to repay these loans, which will result in a significant budget cut. This financial problem could give Ukraine an advantage during peace negotiations with Russia. Kennedy emphasizes that Kyiv should not agree to lift sanctions as a condition for ending the war. Instead, Kennedy believes that lifting sanctions will only be relevant for Ukraine after a complete cessation of the war and the payment of reparations.