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Arctic Ambitions
Russia Works Around Western Energy Sanctions
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  • Che Guevara

    Keep on dreaming that sanctions will bring Russia to its knees. Russia is actually diversifying its economy into agriculture and defense. Russian agriculture is expanding dramatically thanks to sanctions.

    • Tom

      The problem with that being that those are most of Russia’s economy already. How do you diversify into things you already do?

      • Che Guevara

        It’s true that the article describes Russia’s progress in developing its own oil exploration technology, not the diversification of the Russian economy away from oil and other commodities. But the point of the article is that sanctions haven’t stopped Russia from developing its economy. I was adding that Russia is also diversifying its economy away from oil and gas, thanks to the sanctions and to the lower ruble currency rate.
        When oil prices were high, the ruble was overvalued, and Russia was importing massive amounts of agricultural products. But the drop in the ruble and sanctions have stimulated Russian agricultural production. In addition, Russia is expanding its weapons exports. See articles below.
        The Russian economy is adapting to lower oil prices.
        The share of oil and gas revenue in the budget income plunged to 34% in the first quarter of 2016, compared with more than half in 2014.
        Russia has surged by 61 spots in the World Bank’s Ease of Doing Business Index since 2013 to 51st this year.
        Russian agriculture is booming and agricultural production and exports are bigger than defense exports.
        Russian weapons exports are booming, after success in Syria.
        The Army Forum 2016 expo in 2016 attracted more than double the number of foreign delegations compared to 2015, surging from only 38 up to more than 80.
        The annual cost of Russia’s Syria operation is between $1-3 billion, which is comparable to the profits from the extra weapons exports thanks to the Syria operation, so the Syria operation finances itself through extra weapons exports.

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