Putin's secret war-funding scheme is about to explode
news.online.ua
Sun, 12 Jan 2025 22:01:40 +0200
Putin failed to calculate everything correctlyAs Craig Kennedy predicts, if the war drags on for some more time, this scheme will collapse, and the Kremlin will lose the opportunity to finance its aggression against Ukraine, according to the Navigating Russia blog.The analyst draws attention to the fact that Putin is using an additional shadow scheme to finance the war through preferential lending to defense enterprises.Just 2.5 years ago, the aggressor country began a sharp increase in corporate borrowings by 71.
By the fall of 2024, they had grown by 415 billion, equivalent to 19.4 of Russias GDP.
This is more than the gross oil and gas revenues of the Russian Federation and more than the defense budget expenditures for the entire period from autumn 2022 to autumn 2024.
More than half of these funds up to 250 billion are loans received by warrelated and often uncreditworthy enterprises.
Banks issued them under duress from the state.
This is what provoked uncontrolled inflation and pushed the Central Bank to raise the key rate above 20.
Against this background, loans for businesses have become very expensive.What will happen next in RussiaAccording to Kennedy, the Russian government will soon be forced to take on the repayment of loans taken out by key enterprises.De facto 50 of the entire Russian budget will be spent on these needs.The analyst predicted that this could limit public finances for a long period, including Putins ability to pour money into future rearmament.
Russia is on the verge of a systemic credit crisis, and this could be a trump card for Ukraine in future peace talks.
The longer the Kremlin postpones a ceasefire, the higher the likelihood of a credit crisis in Russia, emphasized Craig Kennedy.
According to the analyst, during the negotiations, Putin will demand the lifting of sanctions, but this will be a trap for Ukraine, which is extremely important to avoid.Kyiv must finish off Russia on the economic front while there is still a chance.
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