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Putin trapped: 'He's making Russia China's junior partner'

2022-05-09T21:11:53.503Z


Putin trapped: 'He's making Russia China's junior partner' Created: 05/09/2022, 23:10 By: Jens Kiffmeier Swift exclusion or oil embargo: In the Ukraine war, the EU is cornering Putin. With success? A conversation about sanctions and coup prospects. Bremen – United against Russia in the Ukraine war: the most important economic nations in the world have declared war on President Vladimir Putin.


Putin trapped: 'He's making Russia China's junior partner'

Created: 05/09/2022, 23:10

By: Jens Kiffmeier

Swift exclusion or oil embargo: In the Ukraine war, the EU is cornering Putin.

With success?

A conversation about sanctions and coup prospects.

Bremen – United against Russia in the Ukraine war: the most important economic nations in the world have declared war on President Vladimir Putin.

The G7 countries want to tighten sanctions and impose an oil embargo.

The export of oil and gas is considered the Kremlin's "main artery".

The European Union supports the approach.

But how effective is the weapon?

Can this policy put the brakes on Putin's war of aggression?

Ukraine war: EU takes action against Russian President Vladimir Putin with sanctions

One who can know is Michael Rochlitz.

The professor at the University of Bremen has been studying economic relations with Russia for many years – including before the Ukraine war.

Through personal contacts and study trips to Moscow, he is very familiar with the interrelationships surrounding President Vladimir Putin.

Time to talk about sanctions, oil embargo, oligarchs and a possible fall of the Kremlin tyrant:

The EU is tightening the thumbscrews on sanctions - does this have an effect on Putin? 

 There has never been a case in history where such massive sanctions were imposed on a country as they are now on Russia.

Putin clearly underestimated the extent of this.

Is under pressure because of the oil embargo in the Ukraine war: Russian President Vladimir Putin.

(kreiszeitung.de montage) © Alexander Zemlianichenko/Stringer/dpa

Putin surprised by the force of the sanctions

In what way?

The EU has never made a big secret out of it.

Of course, Putin expected sanctions, but not with this force.

He was also sure that the war would be over quickly and no further sanctions would come.

So are the sanctions an effective weapon?

The sanctions will take effect in the medium to long term.

There is little other way for the West to put pressure on Russia to end the war.

Direct military intervention is very dangerous.

Because on the other side sits with Putin a person who has nuclear weapons and in all probability no longer acts completely rationally.

How exactly will Russia suffer from the sanctions?

In addition to being excluded from the international financial market, Russia is cut off from the possibility of imports, especially in the field of high-tech goods.

The Russian economy is almost completely dependent on them.

Commodities such as gas and oil can be further exported.

But the manufacturing industry, the armaments or automotive industry will soon come to a complete standstill because they no longer have any suppliers.

This makes rearmament difficult, but also threatens hundreds of thousands of jobs.

Oil embargo: EU sanctions hit Russia massively in the Ukraine war

Putin says: No problem, we'll nationalize the companies.

This will not work.

Russia cannot pay the salaries in the long term, and many imported components are missing.

In addition, the threat of nationalizing foreign companies will unsettle international investors.

Even if the war eventually ends and the sanctions are lifted, many companies will shy away from returning to the Russian market for fear of political risks.

The years of attempts to bring investors into the country were then in vain.

This is massive damage that Putin and his people have done here.

Who exactly are the people around Putin?

Who still has influence on the Kremlin ruler?

It's a group of three, four, five, secret service agents and high-ranking military officers.

And they just don't understand how a modern economy works.

They think Russia is a world power with a great history, rich in natural resources that are the envy of the western world.

That is why NATO is trying to bring Russia to its knees.

But Russia is strong enough to fight back.

They have not understood that military strength is ultimately based on economic performance, on technology and innovation.

When are they going to figure it out?

Does the EU need to tighten the thumbscrews even more?

The planned oil and possible gas embargo is probably the greatest possible pressure that the EU can exert.

This will hit Russia massively.

Ukraine conflict: Oil embargo and Swift ban - are sanctions driving Russia into China's arms?

Proven Russia expert: economics professor Michael Rochlitz from the University of Bremen.

© Private

Putin's economy: "Russia would be completely dependent and the junior partner of the Chinese"

Would dealings with China be an alternative for Putin?

The pipelines all go west.

It will take at least a few years to convert the lines to Asia and China.

And it's unclear if China even wants that.

Because then an economic war with the West threatens.

It might be possible that China gives Russia loans and Russia buys consumer goods in China in return.

What would be so bad about that for Putin?

Russia would be completely dependent and the junior partner of the Chinese.

And for a long time.

Because in Russia there will no longer be an engine for growth.

No investments, no innovations, no technology imports from the West - one would have to become self-sufficient again in many areas and tinker things together oneself.

That would be a return to the Soviet Union - probably even worse than it was then.

Overthrow of Putin: There will be no mass demonstrations on the streets

And the population bears all this without complaint?

Russia's population will indeed suffer massively from the crisis.

There are many rich people living in Moscow, but Russia is not a rich country, many Russians still live on the subsistence level.

They are now under great pressure because the sanctions are driving up inflation.

Nevertheless, it is unlikely that there will be protests.

State television has the sovereignty of interpretation and the Russian people therefore completely misjudge the question of guilt for the economic disaster.

Who or what could be dangerous for Putin?

There would be the possibility of a military coup.

Empirical studies show that since World War II, two-thirds of failed dictatorships have ended in palace revolutions, and only one-third in street protests.

In this respect, a putsch would be more likely.

However, the military in Russia has traditionally been apolitical.

Coup against Putin: uprising against Russia's president must come from the military

Do you see any signs of Putin's fall?

That is hard to say.

If irrational decisions continue to be made by Putin, one can only hope that the military elite will have a plan B up their sleeves.

But in principle all people in high positions are very loyal to Putin.

Otherwise they would not have these posts.

For example, in the FSB secret service, dissatisfaction with Putin seems to have increased recently.

What could be done to persuade those close to Putin to initiate a change of power?

Even tougher sanctions?

The problem is that now the military and security elites are not the ones who own the big villas in Italy.

The oligarchs suffer the most from the sanctions.

These are the business bosses who enriched themselves under Putin and have now lost massive amounts of money.

For them, the war is pure madness and it makes no sense at all.

And they can't be dangerous to Putin?

No, the oligarchs hardly seem to have any influence on Putin anymore.

They are not organized, there is no strong business lobby in Russia that could jointly put pressure on Putin.

Ukraine war: oligarchs have too little influence on Putin's fall

There are many myths surrounding the oligarchs.

But according to your assessment, there is no homogeneous mass behind it?

One can perhaps classify the oligarchs into three different groups.

On the one hand there are the oligarchs who became very rich in the 1990s, for example Mikhail Khodorkovsky or Boris Berezovsky.

At the time, they were also involved in setting up Putin as Yeltsin's successor.

They thought it was easy to influence.

A misjudgment.

Yes.

The plan went really wrong.

Some oligarchs had to leave the country quickly.

Khodorkovsky wanted to stay and challenge Putin politically.

He paid for it with prison and the loss of his company.

The remaining oligarchs have made a deal with Putin: they stay out of politics, but are allowed to remain economically active.

Who belongs to the second group of oligarchs?

These are people who got rich because of Putin.

For example, they were in Putin's judo club or with him at the KGB.

Like Igor Sechin, who once carried Putin's briefcase as office manager and is now the head of Rosneft.

Like many of Putin's close associates from the 1990s, he is now a billionaire and fiercely loyal to Putin.

And the third group?

There are actually Russian oligarchs who have built economic empires through their competence, such as Vladimir Yevtushenkov or Oleg Tinkov.

Tinkov is also one of the first oligarchs to sharply criticize Putin.

Nevertheless, the oligarchs are now being sidelined with the sanctions.

Is that helpful?

The oligarchs are rich enough and will not starve.

Most probably expected sanctions and brought money to safety in various countries in good time.

Only, they can't make any more money now.

And they are alpha animals.

They want to be the head of a company and not just sit by the pool.

The only problem is that they have no access to Putin and can hardly influence the course of the war.

In the end, their power is limited.

Mr. Rochlitz, thank you very much for the interview.

About the person: Professor Michael Rochlitz teaches economics at the University of Bremen.

His research focus is on the question of how authoritarian political institutions affect economic processes such as economic growth, business start-ups or the willingness to invest.

Above all, the two countries China and Russia are in his focus.

He himself lived and worked in the state of President Vladimir Putin for many years.

Source: merkur

All news articles on 2022-05-09

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