Russia’s President Vladimir Putin on Sunday appointed Andrei Belousov, a civilian economist with no military experience, as the country’s defense minister.
It shows Russia’s wartime economy is here to stay and that Putin expects the country’s military-industrial complex to be a key pillar of the economy.
Putin, who has styled himself to be a macho alpha male, may also be facing an awkward situation in which brains beat out brawns among his top brass.
As Alex Kliment at Eurasia Group’s GZERO Media put it in a Monday report, “since the invasion of Ukraine, Putin’s nerds have performed better than his jocks.”
Russia and Ukraine appear to be fighting a war of attrition more than two years into the war — upsetting the quick and decisive outcome Putin had expected.
“Right from the start, Russia’s generals and spies — poorly prepared, badly informed, and deeply corrupt — screwed up what was meant to be a short victorious war,” wrote Kliment, who was formerly a Russia analyst at the Eurasia Group.
In comparison, Russia’s economic war with the West appears to be faring much better, as the country’s economy still seems resilient even amid sweeping sanctions.
This is in large part thanks to the “stars of the math class,” led by top Russian central banker Elvira Nabiullina and finance minister Anton Siluanov, who have done “the seemingly impossible,” wrote Kliment.
“They kept the Russian economy afloat despite crippling Western financial sanctions. They held the line as the ‘War Machine’ became central to the economy,” he added.
Russia reported GDP growth of 3.6% in 2023, rebounding from a 1.2% contraction in 2022 — the year it invaded Ukraine.
Siluanove said last month that Russia’s GDP growth this year is expected to reach 3.6%. Meanwhile, the International Monetary Fund forecast that Russia’s economy will grow by 3.2% this year.
Reports from Russia suggest the country’s economy is primarily driven by wartime activities that generate demand for military goods and services, subsidies that steady the economy, and sharp policy-making.
Putin’s focus on Russia’s economy will be on full display when he visits China on Thursday.
The Russian leader is expected to be accompanied by a large trade delegation, new defense minister Belousov, Siluanov, and Nabiullina, among others, according to Russian media reports.
